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19 Cards in this Set

  • Front
  • Back
Allocative Efficiency
term for resourves being deployed to produce just the right amount of each product to statisfy society's wants
an economic system where supplu and demand determine prices
Circluar Flow Diagram
diagram that shows how households and firms are related by the exchange of resources and products
Command Economy
economy in which the central government dictates what will or will not be produced and who gets what
The law of Demand
law that states that when th price of a product increases the quantity demanded decreases, ceteris paribus
Law of Supply
law that states that when te prie of a product increases, th q supplied increases, ceteris paribus
Mixed Economy
a blend of government commands and captialism
place where byers and sellers meet to exchange goods and services
quantitly demanded
has an inverse relationship with changes in the price of a particular good
quantity supplied
has a direct relationship with changes in the price of a particular good
changes in Demand (supply)
shift in demand (supply) due to non-price factors or determinants
Equilibrium Price
price at which quantity supplied equals quantity demanded
Price Ceiling
established below the equilibrium price
PRice Floor
established above the equilibrium price
F: Price Elasticity of Demand
% change in Quantity demanded/% change in price
F:Numerical Coefficienct of Elasticity
Change in Q(p1 + p2)/2)/(change in P (q1 + q2)/2
F:Cross Price Elasticity of demand
% change in Q demended of Product Y/ Change Price of {rpduct X
F:Income Elasticity of Demand:
% change in Q demanded/ % Change in consumer Income
F:Price Elasticity of Supply
% change in Q supplied / % change in price