Supply and demand curves Flashcards
What does a rightward shift of the demand curve mean?
Increase in demand
What does a leftward shift of the demand curve mean?
Decrease in demand
What shift shows an increase in demand?
Rightward
What shift shows a decrease in demand?
Leftward
What are some factor effecting demand?
Population, advertising, Interest rates, purchasing power, reputation of brand, substitutes, etc
What are Normal goods?
Shows a direct correlation between income and quantity demanded of the product as income rises so does the demand for a normal good
What are Inferior goods?
Shows an inverse correlation between income and quantity demanded, an increase in consumer income will reduce demand for these products
What are compliments?
These good are in joint demand where one good is used along with another good
What is supply?
Quantity of a good or service a producer is willing to sell at a given price over a given period of time.
What is the law of supply?
More will be supplied at higher prices then at lower prices
What does a rightward shift of the supply curve mean?
Increase in supply
What does a leftward shift of the supply curve mean?
Decrease in supply
What shift shows an increase in supply?
Rightward shift
What shift shows a decrease in supply?
Leftward shift
What is Equilibrium ?
A state of rest in the market where demand equals quantity supplied
