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26 Cards in this Set
- Front
- Back
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takes place when a consumer reacts to a rise in the price of one good by consuming less of that good |
substitution effect |
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consumer consumes less food without increasing your purchases of other food |
income effect |
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a chart or table that lists the quantity of goods a person will buy at various prices |
demand schedule |
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a table that lists the quantity of a good all consumers in a market will buy at various prices |
Market demand schedule |
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graphic representation of a demand schedule |
demand curve |
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why does the demand curve shift? |
income, population, demographics, consumer tastes and advertising, price of related goods, consumer expectations |
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goods that consumers demand more of when their income increases |
normal good |
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goods that you would buy in smaller quantities or not at all if your income rises |
inferior goods |
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consumer demand of a product rises or falls with price availability |
consumer expectation |
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statistical characteristics of population such as age, race, gender, occupation and income level |
demographics |
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measures how drastically a buyer will cut back or increase their demand for goods when price rises or falls |
elasticity of demand |
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when there is no change in demand for goods when prices rise or fall |
inelastic |
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the demand changes drastically when the prices rise and fall |
elastic |
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amount of money a company receives by buying and selling its goods |
total revenue |
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amount of goods available |
supply |
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describes how much of a good a producer is willing and able to sell at a specific price |
quantity supplied |
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shows the relationship between price and quantity supplied of a specific good |
supply schedule |
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shows the relationship between price and total quantity |
market supply schedule |
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measures how firms will respond to changes in the price of a good |
elasticity of supply |
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cost that does not change no matter how much of a good is produced |
fixed cost |
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costs that rise and fall depending on quantity produced |
variable cost |
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the additional cost of producing one more unit |
marginal cost |
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it id the total cost of operating a facility or business |
operating cost |
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a govt. payment that supports a business or marketplace |
subsidy
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a tax on the production or sale of a good |
excise tax |
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govt, intervention in a market that affects the price, quantity, or quantity of a good |
regulation |
