demand Flashcards
ability and willingness of consumers to buy things
demand
states that if the price of an item is high, the demand will be low
correlation between price and demand
law of demand
high demand»_space;>
high prices
low demand»_space;»
low prices
when consumers substitute one product for another
substitution effect
when you make a purchase, if you feel like you have more money, you buy differently
income effect
the more you purchase, the less satisfaction you get
diminishing marginal utility
a listing/ table that tells you how much you have purchased at each individual price
demand schedule
graphical representation of a demand schedule
demand curve
refers to 1 place on the graph
quantity demand
curve shifts to the right
increase in demand
demand curve shifts to the left
decrease in demand
6 causes of a shift in demand
income normal/ inferior goods consumer expectations population consumer taste advertising
things purchased together
compliments
change of item
substitutes
describes demand that is very sensitive to a change in price
elasticity
needs
inelastic
wants
elastic
total amount of money a business brings in by selling something
total revenue
the ability and willingness of producers to make things available for sale
supply
price is high»> supply is high
low prices»» low supply
high supply»> low prices
low supply»» high prices
law of supply
table listing prices and how much is sold of each individual price
supply schedule
anything that causes a change
variable
items that cause a shift in supply
FOP
3 things gov does to be involved in supply
excise taxes
regulations
subsides
1 more or one less
sale price of a product you sell
marginal revenue
measure of how consumers react to a change in price
elastic demand
describes demand that is not very sensitive to a change in price
inelastic demand
describes demand whose elasticity is exactly equal to 1
unitary elastic demand
