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34 Cards in this Set
- Front
- Back
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The pleasure or satisfaction obtained from a good or service
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utility
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the amount of satisfaction obtained from entire consumption of a product
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total utility
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the change in total utility obtained by consuming one additional unit of a good or service
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marginal utility
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the marginal utility of a good declines as more of its is consumed in a given period of time
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law of diminishing marginal utility
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the percentage change in a quantity demanded divided by the percentage change in price.
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price elasticity of demand
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the price of a product multiplied by the quantity sold in a given time period
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total revenue
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percentage change in quantity demanded divided by percentage change in income
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income elasticity
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good for which demand increases when income rises
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normal good
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good for which demand decreases when income rises.
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inferior good
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percentage change in the quatity demanded of x divided by percentage change in price of y
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cross price elasticity of demand
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the mix of ocnsumer purchases that maximizes the utility attainable from available income
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optimal consumption
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upper limit imposed on the price of a good
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price ceiling
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the relative price of farm products in the period 1910-1914
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parity
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land wirthdrawn from production as part of policy to increase crop prices
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acreage set aside
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the implicit price paid by the government for surplus crops taken as collateral for loans to farmers
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loan rate
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income transfer paid to farmers for difference between targe and market prices.
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counter cyclical payment
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There are few substitutes available for it
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inelastic
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you spend a small percentage of your income on it
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inelastic
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it is a necessity real or perceived
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inelastic
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there are many substitutes availble
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elastic
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you spend a large percentae of your income on it
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elastic
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it is a luxury
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elastic
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ed is less than one
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inelastic
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ed is greater than one
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elastic
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perfectly elastic demand curve is
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horizontal
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perfectly inelastic demand curve is
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vertical
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Each year the average american spends over-------on consumer goods and services
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46000
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marginal utility is a measure of
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how much we value additional units of a product
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The law of diminishing marginal utility reinforces
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the law of demand
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If the marginal utility received from consuming a product diminishes--------then demand for this product is likely to be-------
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slowly, elastic
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If the marginal utility received from consuming a product diminishes--------then demand for this product is likely to be-------
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inelastic
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price ceilings are the result of unhappy
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demanders
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a legally established maximum price that a seller may charge for a particular good or service
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price celing
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price floors are the result of unhappy
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suppliers
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