Supply And Demand Flashcards
Explain the supply curve
As the cost increases, the quantity sold increases
Name 5 factors affecting supply
What is movement?
When there is a change in price AND quantity
What is shift? Give an example
When there is a change in quantity but price remains the same. E.g the quantity of hand sanitiser sales increased in Covid
What is an equilibrium?
When the supply and demand equal each other
Qty supplied = qty demanded
What is supply surplus?
When supply is higher than demand
What is supply shortage?
When demand is higher than supply
What are the construction industry supply factors ?
Labour
Credit
Investment
Material cost
Land
Plant
Market regulation
Competition
What is demand?
The desire to buy a good or service
What are the 3 stages of demand?
The consumer must;
Want it
Be planning to buy it
Be able to afford it
What are 5 factors affecting demand?
Change in expectations. E.g petrol shortages
Change in income - normal goods. E.g luxury car sales will increase if income increases
Change in income - inferior goods. E.g frozen food sales will decrease if income increases
Change in preferences. E.g fashion
Change in number of consumers
Explain the demand curve
The higher the price of a product the less people will buy it
What is quantity demanded?
The amount that consumers plan to buy at a given price
What is money price?
The amount of money it takes to buy a good or service
What is opportunity cost?
The loss of other alternatives when the other option is chosen
