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25 Cards in this Set
- Front
- Back
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the desire ability and willingness to buy a product
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demand
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area of economics that deals with behavior and decision making by small units such as individuals and firms
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micro economics
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listing that shows the various quantities demanded of a particular product at all prices that might prevail in the market.
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demand schedule
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graph showing the quantity demanded at each and every price taht might prevail in the market
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demand curve
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states that the quantity demanded of a good or service varies inversely with its price
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law of demand
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demand curve that shows the quantities demanded by everyone who is interested in purchasing the product
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market demand curve
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extra usefulness or satifaction a person gets from acquiring or using one more unit of a product
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marginal utility
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states that the extra satisfaction we get from using additional quantities of our product begins to diminish.
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diminishing marginal utility
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movement along the demand curve that shows a change in the quantity of the product purchased in response to price change
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change in quantity demanded
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change in quantity demanded because of a change in price that alters consumers' real income
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income effect
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change in quantity demanded because of the change in the relative price of the product
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substitution effect
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causes demand curve shift due to people's will to buy different amounts of the product at the same prices.
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change in demand
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products that can be used in place of other products
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substitutes
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products that are defined when use of one increases use of other
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complements
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measure of responsiveness that tells us how a dependent variable such as quantity ressponds to a change in an independent variable such as price
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elasticity
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total fixed cost
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overhead
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cost that changes when the business rate of operation or outbput changes
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variable cost
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sum of the fixed and variable costs
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total cost
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extra cost incurred when a business produces one additional unit of a product
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marginal cost
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electronic business or exchange conducted over the internet
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e-commerce
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number of units sold multiplied by the average price paid
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total revenue
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extra revenue associated with the production and sale of one additional unit of output
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marginal revenue
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type of cost-beefit decision making that compares the extra benefits to the extra costs of an action
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marginal analysis
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total output or total product the business needs to sell in order to cover its total costs
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break even point
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reached wen marginal cost and marginal revenue are equal
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profit-maximizing quantity of output
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