Micro Economics Chapter 3 (The demand Curve)

Quantity demanded

Movement along the demand curve

Demand

Shifts of the demand curve

Substitutes

Two goods are _____________ if a rise in the price of one of the goods leads to an increase in the demand for the other good.

Complements

Two goods are _________________ if a rise in the price of one good leads to a decrease in the demand for the other good.

Inferior good

When a rise in income decreases the demand for a __________________ Increases

Normal Good

When a rise in income increases the demand for a ___________ increases

An individual demand curve

illustrates the relationship between quantity demanded and price for an individual consumer.

A shift of the demand curve

is a change in the quantity demanded at any given price, represented by the shift of the original demand curve to a new position, denoted by a new demand curve.

A movement along the demand curve

is a change in the quantity demanded of a good arising from a change in the good's price.

A demand curve

is a graphical representation of the demand schedule. It shows the relationship between quantity demanded and price.

A competitive market

is a market in which there are many buyers and sellers of the same good or service, none of whom can influence the price at which the good or service is sold.

The supply and demand model

is a model of how a competitive market behaves.

The quantity demanded

is the actual amount of a good or service consumers are willing to buy at some specific price.

The law of demand

says that a higher price for a good or service, other things equal, leads people to demand a smaller quantity of that good or service.

A demand schedule

shows how much of a good or service consumers will want to buy at different prices