Economics: Chapter 6

Front 1

The quantity consumers are willing and able to buy equals the quantity producers are willing adn able to sell

Back 1

Equilibrium

Front 2

At a given price, the amount by which quantity supplied exceeds quantity demanded; a surplus usually forces the price down

Back 2

Surplus

Front 3

At a given price, the amount by which quantity demanded exceeds quantity supplied; a shortage usually forces the price up

Back 3

Shortage

Front 4

The cost of time and information needed to carry out markt exchange

Back 4

Transaction Cost

Front 5

Consumers are more willing and able to buy the product at every price

Back 5

Increase in Demand

Front 6

Consumers are less willing and able to buy the product at every price

Back 6

Decrease in Demand

Front 7

Producers are more willing and able to supply the product at every prcie

Back 7

Increase in Supply

Front 8

Producers are less willing and able to supply the product at every price

Back 8

Decrease in Supply

Front 9

Occurs when a firm producers at the lowest possible cost per unit

Back 9

Productive Efficiency

Front 10

Occurs when a firm produces the output most valued by consumers

Back 10

Allocative Efficiency

Front 11

A mismatch between quantity demanded and quantity supplied as the market seeks equilibrium; usually temporary, except where government intervenes and sets teh price

Back 11

Disequilibrium

Front 12

A minimum legal price below which a product cannot be sold

Back 12

Price Floor

Front 13

A maximum legal selling price above which a product cannot be sold

Back 13

Price Ceiling

Front 14

The difference between the total amount consumers are willing and able to pay for a given quantity of a good and what they actually pay

Back 14

Consumer Surplus