Economics

What is supply?

Amount of a product that would be offered for sale at all possible prices that could retail in the moment

what is the difference between and individual supply curve and a market supply curve?

Individual: illustrates how a quantity that a producer makes varies depending on price of market. Market: illustrate how a quantity that all producers offer in the market.

what does the law of demand state? and what happens when prices go up and down?

Rule stating that more will be demanded at lower prices. up-quantity goes down down- quantity goes up

what do producers have the freedom to do if prices fall too low?

Slow down production until it stops production

what is movement?

always change in quantity due to price.

how do economists analyze supply?

analyze supply by listing sloping schedule

what is the "income effect"? how does this explain the change in quantity demanded when price goes down?

as prices drop consumers are left with extra real income

describe how the slope of the demand curve can be explained by diminishing marginal utility.

as you continue to use a product the less satisfaction you get from it and the marginal utility decreases.

what is a change in quantity supply?

change in amount offered for sale in response to a change in price.`

What is shift?

change in quantity that was due to something other than price.

what factors cause a change in supply?

cost of inputs, productivity, technology, taxes, and government regulations.

What is demand?

desire, ability, and willingness to by a product

change in price for a complementary good?

if peanut butter goes out of business then nobody will buy jelly

changes of taste/ preference?

if popularity goes down then so does the price if popularity goes up then so do the price

change in price in a substitute product or good?

if the price goes up for "pepsi" then the demand for "coke" goes up and coke will be substituted for pepsi. if a price goes up for something yo will substitute it with something else.

what is an individual demand curve?

illustrates how the quantity that a person will demand varies depending on a price of a good or service

what is a maker demand curve?

illustrates how the quantity that all persons interested will demand varies depending on the price of the good or service.

what are the six thing that cause a change in demand?

income, changes of taste/preference, change in price in a substitute product or good, change in price for a complementary good, change in consumer expectations, and change in number of buyers/population.

what do producers have the freedom to do if the prices rise?

increase production

what is a demand schedule?

list of prices and the quantities that will be bought at each set price

income?

look at example on notes

what is the "substitution effect"?

price can cause consumers to substitute on product with another similar but less expensive product.

what is marginal utility?

satisfaction or usefulness obtained from acquiring one more unit of a product

describe the relationship between the demand schedule and the demand curve.

schedule- table curve- chart

what is a change in quantity demanded?

shows a change in the amount of a product purchased and there is a change in price

what is the principle of diminishing marginal utility?

states that the satisfaction we gain from buying a product lessens as we buy more of the same product. which is why the demand curve is decreasing.

what type of slope does the supply curve have?

supply curve goes up. as price goes up, companies quantities provide goes up

what does the law of supply state?

the principle that suppliers will normally offer more for sale at high prices and less at lower prices

why is the demand curve downward sloping?

there is an inverse relationship. Prices go up quantity demanded goes down and vise versa.

what is a change in demand?

when people buy different amounts of a product at the same price.

change in consumer expectation?

when peoples expectation of price raise in future, they will buy a lot now which will raise the demand of the product now

change in number of buyers/population?

when population rises, the demand of things will all rise.

what is a change in supply?

when suppliers offer different amounts for supply at all possible prices

in an economic sense, when do you stop buying a good?

when the price is to high and there is no more satisfaction (marginal utility)