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20 Cards in this Set
- Front
- Back
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Demand
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the desire , ability and willingness to buy a product
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microeconomics
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deals with the behavior and decision making made by small units (firms and individuals)
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demand schedule
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a listing that shows various quantities demanded of a product at various prices that migh prevail in the market at a given time
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demand curve
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same as a demand schedule but in a graph
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law of demand
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lower prices = higher demand and vice versa
demand and price vary inversely |
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market demand curve
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the demand curve that shows the quantities demanded by everyone who is interested in purchasing the product
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marginal utility
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the extra usefullness or satisfaction a consumer gets from a product
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diminishing marginal utility
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when the extra satisfaction we get form additional use of a product diminishes
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income effect
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the change in quantity demanded because of a change in price that alters consumers real income
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substitution effect
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the change in quantity demanded because of the change of the relative price of a product. and thus causes the rise in demand of another product
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change in demand
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a change in the demand curve, a change in market conditions where people are willing to buy different amounts of a product at the same price (it makes the enitre demand curve change because the actual demand has changed)
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substitues
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can be used in place of other products .
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complements
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a product thats use increases the use of another product
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expectations
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the way people think about the future .
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elasticity
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a measure of responsiveness that tells us how a dependant variable responds to a change in demand
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demand elasticity
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the extent to which a change in price causes a change in the quantity demanded
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elastic
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when a change in price causes a relatively larger change in quantiti demanded.
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inelastic
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a change in price causes a relatively small change in the quantity demanded .
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unit elastic
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a given change in price causes a proportional change in quantity demanded.
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types of elasticicty
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purchased be delayed ?
are there substitutions? does the purchase use a large portion of income ? |
