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Flashcards in Chapter 4- Section 2 Deck (17):
0

A movement along the demand curve that shows a change in the quantity of the product purchased in response to a change in price

Change in quantity demanded

1

What happens when prices drop?

Consumers pay less therefore they have more money; they feel wealthier and buy more

2

The change in quantity demanded because of the change in price that alters consumers real income

Income effect

3

How can an increase in price affect quantity demanded?

Less quantity demanded

4

What do consumers tend to do when similar products are available and one is more costly than other?

Purchase the cheaper product

5

The change in quantity demanded because of the change in the relative price of the product

Substitution effect

6

Something that causes the demand curve to shift

Change in demand

7

What happens if the consumer income rises?

Demand curve goes to the right more money is spent

8

What factors can affect consumer tastes?

Ads, news reports, fashion trends, intro to new products, and seasons

9

What happens to the demand for a product if the price of a substitute goes up?

Higher demand for the cheaper product

10

How does an increase in a product price affect demand for the product's complement?

It goes down because there's no money left over

11

What happens to the demand for product if consumers think that a future product will be better?

Down, people want to save for the better product

12

Can be used in place of other products

Substitutes

13

The use of one increases the use of another

Complements

14

What happens to the demand for product if consumers think there'll be a shortage in the future?

Goes up

15

What happens to the market demand curve if there is an increase in the number of consumers?

Goes up because more people want an item therefore the curve shifts to the right

16

What happens to a market curve whenever anyone leaves the market?

The less a product is but it has less demand therefore the curve shifts to the left