Term
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Definition
| a function that shows the quantity demanded at different prices |
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Term
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Definition
| the quantity that buyers are willing and able to buy at a particular price |
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Term
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Definition
| the consumer's gain from exchange; the difference between the maximum price a consumer is willing to pay for a certain quantity and the market price |
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Term
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Definition
| area beneath the demand curve and the market price |
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Term
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Definition
Income
Population
Price of Substitutes
Price of Complements
Expectations
Tastes |
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Term
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Definition
| a good for which demand increases when income increases |
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Term
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Definition
| a good for which demand decreases when income increases |
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Term
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Definition
| a decrease in the price of one good leads to a decrease in demand for the other good |
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Term
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Definition
| a decrease in the price of one good leads to an increase in the demand for the other good |
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Term
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Definition
| a function that shows the quantity supplied at different prices |
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Term
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Definition
| the amount of a good that sellers are willing and able to sell at a particular price |
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Term
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Definition
| the producer's gain from exchange; the difference between the market price and the minimum price at which a producer would be willing to sell a particular quantity |
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Term
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Definition
Technological innovations/changes in the price of inputs
Taxes and subsidies
Expectations
Entry or Exit of Producers
Changes in Opportunity Costs |
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Term
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Definition
| a situation in which the quantity supplied is greater than the quantity demanded |
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Term
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Definition
| a situation in which the quantity demanded is greater than the quantity supplied |
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Term
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Definition
| the price at which the quantity demanded is equal to the quantity supplied |
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Term
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Definition
| the quantity at which the quantity demanded is equal to the quantity supplied |
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Term
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Definition
| how responsive the quantity demanded is to a change in price; more responsive = more elastic |
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Term
| equation for elasticity of demand |
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Definition
| percentage change in quantity demanded/percentage change in price |
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Term
| the great economic problem |
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Definition
| to arrange our limited resources to satisfy as many of our infinite wants as possibilities |
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Term
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Definition
| the attempt to profit from future price changes |
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Term
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Definition
| a speculative market designed so that prices can be interpreted as probabilities and used to make predictions |
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Term
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Definition
| rewards and penalties that motivate behavior |
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Term
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Definition
| the value of the opportunities lost in making a choice |
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Term
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Definition
| an increase in the general level of prices |
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