Micro Economics chapter 2
a higher-quality; more expensive
Inferior goods are those where you're "making do," and when your income rises, you'll shift to _____, but _____ alternative, instead.
Additional; marginal
The _____ benefit you get from buying one additional item is called its _____ benefit.
Products become less valuable when more people use them
Congestion effect occurs when a good becomes:
Demand increases; demand will decrease
If a good with network effects becomes more popular, its value to the individual consumer _____. If a good with congestion effects becomes more popular, its value to the individual consumer _____.
A rise; diminishes
Moving up along the demand curve due to _____ in price would cause quantity demand to fall, while shifting the demand curve to the left _____ quantity demand for any fixed price.
relatively unimportant
Over short periods of time, increases in population are _____ in their effects on demand compared with increases in population over long periods of time.
Law of demand
The _____ states that the total quantity demanded is higher when the price is lower.
If the benefits exceeds the cost
The cost-benefit principle suggests that you should buy an item when:
Maximize; marginal benefit
When you apply the Rational Rule for Buyers, you can _____ your economic surplus by continuing to buy until price equals _____.
Inferior goods
_____ are those goods you buy less of when your income rises.