Quiz #2 Vocab Flashcards Preview

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Flashcards in Quiz #2 Vocab Deck (15):
0

The law of ________

Consumers demand a greater quantity at lower prices than at higher prices.
*price and quantity demanded are inversely related

The law of demand

1

The law of _______

Producers supply a greater quantity at higher prices than at lower prices.
*price and quantity supplied are directly related

The law of supply

2

Government sets the maximum price for a good.
Set below equilibrium.
Causes shortages.

Price Ceiling

3

Government sets the lowest possible price for a good.
Set above equilibrium.
Causes surpluses.

Price floor

4

How much will supply or demand change when price changes

Elasticity

5

Medium of exchange
Measure of value
Store of value

These are functions of ______

Functions of money

6

A firm with one owner/operator
Has unlimited liability

Sole proprietorship

7

A firm with two or more owners/operators
Has unlimited liability

Partnership

8

A firm owned by shareholders
Owners (shareholders) have limited liability

Corporation

9

Act of firms selling final goods and services to customers

Product market

10

Act of households selling resources to firms

Factor market

11

Many sellers of identical products- no single firm can control the price
Ex: agricultural products

Perfect or pure competition

12

Many sellers but products are not identical.
Firms use product differentiation to monopolize part of the market.

Monopolistic competition

13

A few large firms control a market
They are highly interdependent
Ex: cereal, computers, tobacco

Oligopoly

14

A single firm controls a given market. Output is lower, price is higher than it should be.

Monopoly