Chapter 6 Flashcards Preview

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Flashcards in Chapter 6 Deck (10):
1

market equilibrium

at a certain price, quantity demanded and quantity supplied are equal

2

equilibrium price

price at which quantity demanded and quantity supplied are equal

3

surplus

more quantity supplied than demanded

4

shortage

more quantity demanded than supplied

5

disequilibrium

imbalance between quantity demanded and quantity supplied

6

competitive pricing

selling products at lower prices than others which lures costumers away from other products and maintains overall profits by selling more units

7

incentive

encourages people to take certain action

8

price ceiling

legal maximum price a seller may change for a product

9

price floor

legal minimum price buyers may pay for product

10

rationing

way of allocating products using factors other than price