Demand + Supply Flashcards

1
Q

latent demand

A

unable to actually buy (no money)

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2
Q

effective demand

A

able to actually buy

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3
Q

demand

A

the quantity of a good or service a consumer is willing and able to purchase at a given price

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4
Q

market demand

A

the sum of the individual demand

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5
Q

revenue

A

the income a business receives from selling its products

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6
Q

supply

A

the quantity of a good/service that producers are willing and able to sell at each different price level

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7
Q

consumer surplus

A

the difference between what consumers are willing to pay for a good/service and the price they actually pay

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8
Q

producer surplus

A

the difference between what firms are willing to sell a good/service for and the price they are actually paid

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9
Q

complements (joint demand)

A

goods that are consumed together

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10
Q

substitudes

A

products that can replace each other

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11
Q

composite demand

A

goods have more than one use

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12
Q

derived demand

A

demand for a FOP is derived from the demand for the product it produces

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13
Q

joint supply

A

two or more goods are produced

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14
Q

Policy to increase demand for business

A
  1. reducing the price of the good
  2. advertising to increase demand
  3. switch production to inferior goods
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