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17 Cards in this Set

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Law of demand
The principle that there is an inverse relationship between the price of good and quantitiy buyers are willing to purchase in a difined tume period, ceteris paribus.
Demand
A cure or schedule showing the various quanities of product consumers are willing to purchase at possible price duing a specified period of time, ceteris paribus
Change in Quantity demanded
A movement between points along a stationary demand curve, cetris paribus
Change in demand
an increase or decrease in the quantity demanded at each possible price. An increase in demand is a rightward shift in the entire demand curve. A decrease in demand is a leftwared shift in the entire demand curve
normal Good
Any good for which there is a direct relationship between changes in income and its demnd curve
Inferior Good
Any good for which there is an inverse relationship between changes in income and its demand curve
Substitute Good
A good that competes with another good for consumer purchases. As a result, there is a direct relationship between a price change for one good and the demand for its "competitor" good.
Complementary good
A good that is jointly consumed with another good. As a result, there is an inverse relaitonship between a price change for one good and th edemand for the "go together" good.
Law of supply
The principle that there is a direct relaionship between the price of a good and th equantity sellers are willing to offer for sale in a defined time period, ceteris paribus.
Supply
A curve or schedule showing th evarious quantities of a product sellers are wiling to produce and offer for sale at possible prices during a specified time period, ceteris paribus.
Change in quantity supplied
A mvement between points along a stationary supply curve, cetris paribus.
Change in supply
An increase or decrease in the quantity supplied at each possible price. An increase in supply is a rightward shift in the entire supply curve. A decrease in supply is a leftward shift in th eentire supply curve.
Market
Any arrangement in which buyers and sellers interact to determine the price and quantity of goods an dservices exchanged
surplus
A market condition that existing at any price where the quantity supplied is greater than the quantity demanded
shortage
A market condition exsiting at any price where the quantity supplied is less tan the quantity demanded
Equilibrium
A market condition tha toccurs at any price and quantity where the quantity demanded and th equantity supplied are equal
Price system
A mechanism that uses the forces of supply and demand to creat an equilibrium through rising and falling prices