Supply and Demand Flashcards
What is derived demand?
When the demand for one good comes from the demand from another good.
What is composite demand?
When a good is demanded for more than one purpose so an increase in demand for one purpose decreases supply for another purpose.
What is equilibrium?
The price at which supply is equal to demand.
What is disequilibrium
The price at which supply is not equal to demand.
What is demand?
The amount consumers are willing and able to buy at each given price point.
What is supply?
The amount offered for sale by producers at each given price point.
What is the price elasticity of demand?
The responsiveness of demand to a change in price.
What is price elasticity of supply?
The responsiveness of supply to a change in price.
What is income elasticity of demand?
The responsiveness of demand to a change in income.
What is cross price elasticity of demand?
The responsiveness of demand to a change in price of another good.
