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26 Cards in this Set
- Front
- Back
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revenue formula
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price x quantity demanded= revenue
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profit formula
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revenue - price= profit
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supply
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amount of good available
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law of Supply
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when prices go up, quantity supplied goes down
*direct relationship |
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quantity supplied
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amount a supplier is willing and able to supply at a certain price
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supply schedule
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table that lists how much of a good a supplier will offer at different prices
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variable
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factor that can be changed
EX: price of quantity, quantity demanded |
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marginal product of labor
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the change in output fro hiring one additional employee
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fixed costs
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cost that does NOT change
Ex: rent, managers |
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variable costs
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cost that can be changed
EX: some goods, employees |
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total cost
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fixed cost+variable cost
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marginal cost
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cost of producing one or more unit of a good
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Equilibruim
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quantity demanded, quantity supplied
*considered perfect/ideal to set product at to make as much profit as possible |
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price ceiling
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maximum price by law
EX: rent control |
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Price floor
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minimum price by law
EX: minimum wage |
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Demand
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desire to own something and the ability to pay for it
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Substitution effect
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when consumers react to an increase in a good's price by consuming less of that good and more of the other goods
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market demand schedule
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all consumers in a market
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demand curve
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graph representation of demand schedule
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normal good
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good that consumers demand MORE of when their incomes increase
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inferior good
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good that consumers demand less of when their income increases
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complements
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2 goods that are bought and used together
EX: peanut butter and jelly |
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substitutes
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good in place of another
EX: Coca-cola and Sam;s choice cola |
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elasticity of demand
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measure of how consumers react to a change
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inelastic products are considered _________.
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needs
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elastic products are considered ________.
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wants
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