econ 7~12 Flashcards
demand
the willingness and ability to buy a product
market demand
total demand of product
aggregation
addition of individuals components to reach a total amount
extension indemand
the price fall due to increase in quantity demanded
contraction of demand
fall in quantity demand increases the price of product
increase in demand
rise in demand, at any given price, demand shifts to the right(outwards)
normal goods
products that increase in demands as income increases
inferior goods
products that decrease in price as income increases
substitutes
product that can replace another
complement
product that is used with other products
supply
willingness and ability to sell a product
market supply
total amount of supply
extension/contraction of suply
rise/fall of quantity supplied to rise/fall in price
unit cost
avg cost of production
direct tax
tax on income & wealth of individuals and firms
indirect tax
taxes on goods and sevices
tax
payment on government
subsidy
payment by government to encourages production/consumption of a product
excess supply(surplus)
the amount of how much supply is greater
excess demand(shortage)
the amount of how much demand exceeds supply
Price Elasticity of demand (PED)
measure of responsiveness of quantity demand to change in price
elastic demand
quantity demand changes in greater percentages in price
inelastic demand
quantity demand changes in smaller percentages in price
unit elasticity of demand
even there is a change in price, revenue is maintained the same
perfectly in/elastic demand
no change in price/quantity even the other axis changes
Price Elasticity of Supply(PES)
measure of responsiveness of quantity supplied to change in price
elastic supply
quantity supplied changes in greater percentages in price
inelastic supply
quantity supplied changes in smaller percentages in price
unit PES
change in price causes equal percentage change in quantity supplied
