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Flashcards in OPENSTAX CH. 3 Deck (45)
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1

demand

amount of some good/service consumers are willing and able to pruchase at each price, based on needs and wants, based on ability to pay

2

pice

what buyer pays for specific unit of good or service

3

qty demanded

total number of units purchansed at that price; increase price , lower demand

4

law of demand

inverse relationship between price and quatnity demanded, assumes everything else constant

5

demand schedule

table showing qty demanded at each price

6

demand curve

shows relationship between price and quantity demanded

7

demand refers to _, qty demand refers to _

curve, specific point on curve

8

supply

amount of some gs a producer is willing to supply at each price

9

price is what

producer recieves for selling one unit of good/service - rise in price usually equals rise in quatnity supplied of g/s

10

supply curve

graphic illustration of relationship between price and quantity

11

equilibrium

point where supply curve and demand curve cross

12

equilibrium price

quantity demand equals equantity supplied

13

excess surpus

any above equilibrium price, qty supplied exceeds qty demanded

14

if price is above equilibrium level what happens

incentives built into structure of d/s will create pressures for price to fall towards equilibrium

15

excess demand/shortage

at given price, qty demanded exceeds qty supplied which had been depressed by lower price; price will rise towards equilibrium level

16

facotrs affecting demand

taste, preferences, income, price of related goods, size and composition of population, expectations

17

ceteris paribus assumption

other things equal

18

normal good

porudct whose demand rises when income rises

19

infereior good

product whose demand falls when income rises

20

subsitutte

g/s that can be used in place of another g/s

21

complements

onsump of 1 equals consump of other

22

shift in demand

happens when change in some economic factor other than price causes a different equanitty to be demande at every price

23

shift in supply

cange in quaty supplied at every price

24

factors affecting supply

profts, cost of product, inputs, labor, materials, machinery, weather, natural conditions, new technoloyg, governemnet policies

25

subisdy

when gov pays firm directly or reduces firm's taxes if firm carries out cetian actions

26

quantity supplied is greater than quantity demand equals what

surplus

27

efficienty

when its impposible to improve situation of one party without imposing ost on another

28

inefficienty

possile to benefit at least one party without imposing cost on others

29

consumer surpus

amt individual wouldbe been willing to pay minus amt they actually pay

30

consumer surplus on a graph

area above market price and below demand curve