Section 3 Obj 1&2

Question 1

What is a market?

Answer 1

The market is a place where buyers and sellers come together to trade for goods and services

Question 2

What are market forces?

Answer 2

Market forces refer to the forces of demand and supply. The term relates to the total level of demand and supply at a particular time, from all the buyers and sellers who make up the market

Question 3

What is ceteris paribus?

Answer 3

is the latin phrase meaning “other things remaining constant” Economists cannot hold conditions constant in the real world.

Question 4

What is ceteris assumption used for

Answer 4

economists use the ceteris paribus assumption to hold certain factors constant in order to make predictions about consumer behaviors and to establish relationships between variables.

Question 5

Economists look ….. ceteris paribus

Answer 5

Economists look at the relationship between the demand/supply for a product and its price, ceteris paribus