Demand

The quantity of a good or service that consumers are both willing and able to buy at various prices

Law of Demand

An economic law stating that as the price of a good or service increases, the quantity demanded decreases and vise versa.  Generally, consumers are happier to buy goods and services at lower prices than at higher prices.

Substitute Good

A product that satisfies the same basic want as another product.  Substitute goods may be used in place of one another.

Complementary Good

A product that is used or consumed jointly with another product.  Such a good usually has more value when paired with its complement than when used separately.

Supply

The quantity of a good or service that producers are willing and able to offer for sale at various prices.

Law of Supply

An economic law stating that as the price of a good or service increases, the quantity supplied increases, and vice versa.  Generally, producers are happier to offer goods and services at higher prices than at lower prices.

Revenue

The amount of money a firm receives in the course of doing business.  Revenue is calculated by mutiplying the quantity sold by the price.

Elasticity

A measure of the degree to which the quantity demanded or supplied of a good or service changes in response to a change in price.

Quantity Demanded

The amount of a good or service that consumers are wiling and able to buy at a specific price.

Demand Schedule

A table or chart that lists the quantities of a good that one person will buy at various prices.

Demand Curve

A graph that shows the relationship between price and the quantity that buyers are willing and able to buy.

Market Demand

The sum of all the individual demands in a market.

Change in Quantity Demanded

Any movement- a change in price- that causes a change in the quantity demanded.

Change in Demand

A change that occurs when quantites demanded increase or decrease at all prices.

Demand Shifters

Any 6 causes that are able to create a change in demand for a good or service.

Quantity Supplied

The amount of a good or service that producers are willing and able to offer for sale at a specific price.

Supply Schedule

A table or chart that shows the quantities supplied at different prices in a market.

Supply Curve

A line/curve that shows the relationship between the price and the quantity that producers are willing and able to supply.

Market Supply

The sum of all the individual quantities supplied.  When economists refer to supply- they are usually referring to market supply.

Change in Quantity Supplied

Any movement along the supply curve.  This movement is caused only by a change in price.

Change in Supply

A change in supply- which can cause prices to increase or decrease- like a change in the number of producers- can change or shift the supply curve to a new position.

Subsidy

A cash payment aimed at helping a producer to continue to operate.

Example- farmers

Excise Tax

A slaes tax on the manufacture or sale of a good.  It's an additional sales tax that adds to the cost of an item.

Examples- gasoline, tobacco, alcohol

Elasticity of Demand

A measure of consumers' sensitivity to a change in price.

Inelastic

A demand for necessities, like toothpaste, that responds slightly or not at all to a change in price.

Elastic

A response to a change in price that can cause a change in the amount produced.

Total Revenue Test

A measure or tool that helps producers price their products at a level that maximizes their revenue.

Supply Chain

A network of people, organizations, and activities involved in supplying goods and services to consumers.