Lecture 4 Flashcards
(21 cards)
What axis does the quantity go on?
The horizontal axis
What is the demand curve?
The relationship between price and quantity demanded
What is tastes and preferences?
Things that make the demand curve change based on things like tempature, some one dying and their belongings going up, fads.
What is a substitute
Something that will substitute for something else
I.e coke Pepsi
Gatorade poweraid
What is a compliment?
Things that work well together
I.e
Peanut butter and jelly
Hot dogs and hot dog buns
As your income goes up what happens to a normal good?
It goes up
As your income goes up what happens to an inferior good?
Go down
What is a normal good?
Things you want to have more of or need to have/
What is an inferior good?
Something that’s cheap like ramen
What happens as the number of consumers goes up?
The demand goes up
What is expected future prices?
The expectation that things are cheaper today than tomorrow so you buy today
Which axis does the price go
The y axis
What are the factors of demand
Substitutes Compliments # of consumers Taste preference Income Normal and inferior goods Expected future prices
What does it mean to horizontally aggregate
Take all the graphed lines of either the supply or demand and add together to get the totally of everything and graph
What is a decrease in supply?
Shift to left
What is an increase of supply?
A shift to the right
If an input gets more expensive supply will
Decrease
Technologically innovation does what to supply?
Increase it
If wages go up what happens to supply?
It goes down
If the #of firms increases what happens to supply
Supply increases
How does taxes and subsides affect supply
The supply of the less taxes or subsides product will increase
