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Get faster at matching terms Terms in this set (35)Voluntary Exchange A transaction in which a buyer and a seller exersise their economic freedomby working out their own terms of exchange. Law of Demand Economic rule stating that the quantity demanded and the price move opposite directions. Diminishing Marginal Utility Rule stating that the additional satisfaction of a gets from purchasing one more unit of a product will lessen with each additional unit purchased. Real Income Effect Economic rule stating that individuals cannot keep buying the same quantity of a product if their income stays the same. Substitution Effect Economic rule stating that if two items satisfy the same need and the price of one rises, people will buy more of the other product. Demand Curve Downwardsloping line that shows in graph form the quantities demanded at each possible price. Price Elasticity of Demand Economic concept that deals with how much demand varies according to changes in price. Elasticity Economic concept that deals with how much demand varies according to changes in price. Elastic Demand Situation in which a given rise or fall in a product's price greatly affects the amount that people are willing to buy. Inelastic Demand Situation in which a product's price change has little impact on the little impact on the quality demanded my consumers. Complementary Good A product often used with another product. Demand The amount of a good or service that consumers are able and willing to buy at various possible during a specified time period. Supply The amount of a good or service that producers are able and willing to sell at prices during a specified time. Market The process of freely exchanging goods and services between buyers and sellers. Quantity Demanded The amount of a good or service that a consumer is willing and able to purchase at a specific price. Utility The ability of any good or service to satisfy consumer wants. Marginal Utility An additional amount of satisfaction. Demand Schedule Table showing quantity demanded at different possible prices. Law of Supply Economic rule stating that price and quantity supplied move in the same direction. Quantity Supplied The amount of a good of service that a producer is willing and able to supply at a specific price. Supply Schedule Table showing quantities supplied at different possible prices. Supply Curve Upward-sloping line that shows in graph form the quantities supplied at each possible price. Technology The use of science to develop new products and new methods for producing and distributing goods and services. Equilibrium Price The price at which the amount producers are willing to supply is equal to the amount consumers are willing to buy. Shortage Situation in which the quantity demanded is greater than the quantity supplied at quantity supplied. Surplus Situation in which quantity supplied is greater than quantity demanded at the current price. Price Ceiling A legal maximum price that may be charged for a particular good or service. Rationing The distribution of goods and services based on something other than price. Black Market "Underground" or illegal market in which goods are traded at prices above their legal maximum prices or in which illegal goods are sold. Price Floor A legal minimum price below which a good or service may not be sold. Determinants of Demand 1. Changes in population Law of Diminishing Returns Economic rule stating that as more units of a factor of production are added to other factors of production, after somepoint total output continues to increase but at a diminishing rate Determinants of Supply 1. Price of inputs Shift in Equilibrium Price If there is a shift in demand (whole demand curve shifts) or a shift in supply (whole supply curve shifts), there will be a new equilibrium price. Forces Underlying Supply and Demand 1. Demand Forces-people's income and prefences Recommended textbook solutions
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ECONOMICS The following hypotheses are given.A sample of 120 observations revealed that .30. At the .05 significance level, can the null hypothesis be rejected? a. State the decision rule. b. Compute the value of the test statistic. c. What is your decision regarding the null hypothesis? $$ H_0:π=.40; H_1:π≠.40 $$ Verified answer Other Quizlet setsMacro Exam 12/8 Review78 terms hannah_paukovits8 Chapter 11 drug therapy in Geriatric patients14 terms jsweiss17 Biochem Exam 2 Notes250 terms allysonkemmerer Sociology Education Revision38 terms Tereza_Todorova71 Related questionsQUESTION Why are free market economies able to obtain economic growth? 11 answers QUESTION the demand curve slopes downward and to the right 15 answers QUESTION Entrepreneurs bring the factors of production together 3 answers QUESTION Any tax system with vertical equity implies that the tax system will also be progressive. 2 answers What is the amount of goods or services that producers are willing and able to sell?1. Economists define supply as the quantity of a good or service that producers are willing and able to offer for sale at each possible price during a given time period.
Which term refers to the amount of a good or service that producers are willing and able to make available at a certain price?Definition. the amount of a good or service that producers are able and willing to sell at various prices during a specified time period.
When the amount that producers are willing to supply equals the amount consumers are willing to buy?The equilibrium price and quantity are where the two curves intersect. The equilibrium point shows the price point where the quantity that the producers are willing to supply equals the quantity that the consumers are willing to purchase. This is the market equilibrium quantity to supply.
Is the amount of a good or service that consumers are willing and able to purchase at a certain price?Economists use the term demand to refer to the amount of some good or service consumers are willing and able to purchase at each price. Demand is based on needs and wants—a consumer may be able to differentiate between a need and a want, but from an economist's perspective they are the same thing.
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What is the amount of a good or service that a producer is willing to sell at each particular price?
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