TEST 8 Economics Flashcards
What is the amount of a good that is bought at a certain price under certain conditions
Demand
What is the relationship between a good’s price and the amount the people is willing to buy
Demand
The relationship between a good’s price and the amount the producers are willing to provide
Supply
The 2 types of value
Value in use and value in exchange
Value that is directly related to the benefits that owners receive through their use
Value in use
What is a particular good in exchange for some other good
Value in exchange
The amount of money that a buyer pays a seller for a particular item
Price
As one’s supply of a specific good increases the satisfaction derived for each additional unit decreases
Diminishing Marginal Utility
The amount of satisfaction that results from a one unit increase tends to become smaller with each additional unit
Marginal Utility
The total amount of satisfaction for receiving a particular good is called
Total utility
As the price of a good increases the quantity demanded decreases
The law of demand
When the price of a good falls consumers tend to buy more of that good or other items because they can do so without giving up anything
Income effect
What indicates that people tend to substitute less expensive goods for ones who’s prices has risen
Substitution effect
For everyone there is a point in which price becomes the point of consideration
True
What is a list of numbers that compare price with quantity
Demand schedule
Graphic representation of the quantity of goods purchased at different prices
Demand curve
Demand curve goes to what direction
Down right
Things that affect a change in demand pg.57-58
Taste and preferences affect in quantity demanded
False
Population affects in change of quantity supplied
False
A good who’s demand is directly related to consumers incomes
Normal good
Demand for what type of items decreases as what incomes increases?
Inferior goods
A good capable of being use in place of another
Substitute
A good often use in conjunction with other
Complement
As the price of a good increases the quantity supplied also increases
Law of supply
What is a list of numbers that compares price with quantity supplied
Supply schedule
Things that affect the change in supply
What is called when a government would give money to improve production
Subsidies
What is point in which quantity supplied and quantity demanded stay equal
Equilibrium
Fall below the equilibrium
Shortage
Above the equilibrium
Surplus
The sharper the curve, the more what?
Inelastic
What allows for goods to be elastic
Substitutes
Price ceilings results in what?
Shortage
Price floors results in
Surplus
Good way to destroy a city
Booming and rent control
Signs that are used by consumers and producers to determine how much of a good to buy or sell at a given price and time
Market signals
Goods that have a life expectancy of less than three years
Nondurable goods
Products that are expected to last at least three years
Durable goods
The part of an economy that is controlled by private individuals, businesses, and organizations.
Private sector
The part of economy which is controlled by national, state, and local governments
Public sector
The reason that a person is willing to trade certain goods wether they are tangible items, or other goods.
Profit motive
The value of the best alternative that is foregone when a different alternative is taken
Opportunity cost
The wage that will cost people who run their own establishments to hire managers to manage their business for them
Wage of management
Total value of a business minus any liability
Equity
