Chapter 5 Flashcards Preview

Economics > Chapter 5 > Flashcards

Flashcards in Chapter 5 Deck (27):
1

supply

willingness and ability of producers to offer goods and services for sale

2

law of supply

producers willing to sell more of a product at higher price than at lower price

3

supply schedule

shows amount of product individual willing, able to offer at each price

4

market supply schedule

shows amount of product all producers willing, able to offer at each price

5

supply curve

shows data from supply schedule in graph form

6

market supply curve

shows data from market supply schedule

7

marginal product

change in total output caused by adding one worker

8

specialization

having a worker focus on one aspect of production

9

marginal product schedule

relation between labor and marginal product

10

increasing returns

new workers cause marginal product increase

11

diminishing returns

total output grows at decreasing rate

12

negative returns

output deceases though crowding and disorganization

13

fixed cost

expenses owners insure no matter how much they produce

14

variable cost

expenses that vary as level of output changes

15

total cost

the sum of fixed and variable costs

16

marginal cost

additional cost of making one more unit of the product

17

how to you calculate marginal cost

divide change in total cost by change in total product

18

change in quantity supplied

rise or fall in amount offered for sale because of change in price (does not shift the supply curve)

19

change in supply

producers offer different amount at every price (shifts the supply curve)

20

input costs

price of resources needed to produce good or service

21

six factors that cause change in supply

1. input costs 2. labor productivity 3. technology 4. government action 5. producer expectation 6. number of producers

22

labor productivity

about of product worker can produce in set time

23

technology

use of scientific methods and discoveries in production

24

government action

excise tax and regulation

25

elasticity of supply

measures producer response to price changes

26

unit elastic

price and quantity supplied change by same percentage

27

elastic supply

as product gains popularity, shortage develops and price goes up