Supply and Demand Test Flashcards Preview

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Flashcards in Supply and Demand Test Deck (32):
1

define supply

the willingness and ability of producers to offer goods and services

2

define demand

the willingnes to buy a good or service and the ability to pay for it

3

define total revenue

a company's income from selling its products

4

define demand curve

graph that displays data from demand schedule; demand-down

5

define supply curve

graph the displays data from supply schedule; supply-sky-up

6

define demand schedule

list of how much of an item an individual is willing to purchase at every price

7

define supply schedule

list of how much of a good or service a producer is willing to offer at each price

8

define law of supply

1. Price decrease, supply decreases
2. Price increases, supply increases

9

define law of demand

1. Price decreases, demand increases
2. Price increases, demand decrease

10

define Price Floor

legal minimum price for a good or service ex: minimum wage

11

define Price Ceiling

legal maximum price for a good or service ex:gas prices every day

12

define substitutes

products used in place of other products to satisfy needs or wants ex:Nutella instead of PB

13

define Complements

products used together ex: PB and Jelly

14

define Marginal cost

extra cost of producing 1 more unit

15

define marginal product

change in total output brought about by adding one more worker

16

define fixed costs

costs that the owner occurs no matter how much they produce

17

define variable costs

costs dependent upon the level of production output

18

define total profit

idk

19

define regulation

a government factor that affects supply

20

define surplus

results when the quantity supplied is greater than the quantity demanded

21

define shortage

results when the quantity supplied is less than the quantity demanded

22

define Equilibrium price

price at which the individual quantity demanded and individual quantity supplied are equal

23

How is total revenue calculated?

all sales or money coming into the business

24

what factors affect demand?

willingness to pay, ability to pay, market size, consumer taste, consumer expectations, substitutes and complemts

25

what factors affect supply?

input costs, labor productivity, technology, govt action, number of producers

26

How do business owners decide on the right number of workers?

idk

27

How does a business owner calculate total profit?

total sales or revenues minus total costs

28

What motivates producers to increase supply?

price always motivates producers and consumers in a market economy

29

What do lower prices encourage?

consumers to buy goods and services

30

What does a surplus indicate?

prices are too high

31

What does a shortage indicate?

price is too low

32

When customers demand more goods and services at every price, what will happen to the equilibrium?

it will shift