economics key terms Flashcards
what is demand?
the willingness and ability of a consumer to buy goods and services at a certain price
what is supply?
the number of products a producer is able to and willing to provide
what is elasticity?
the change in demand of a product in relation to price
what is market failure?
inefficient distribution of goods and services in a market
what is government failure?
when government intervention fails to achieve goals, or causes consequences
what is externalities?
when an organisation is impacted by a third party organisation
what is a regulation?
a set of rules imposed by the government that tries to change the behavior of organisations
what is equilibrium?
supply and demand are balanced
what is tax?
mandatory contributions to the government
what is consumer surplus?
the price consumers pay is less than what they are willing to pay
what is a positive statement?
can be tested or proven wrong/right
what is a normative statement?
subjective, cant be proven/tested
