Econ unit 2 notes

Variable Costs

Costs that fluctuate as output changes are called

Diminishing Marginal Utility

Tommy's dad caught him smoking a cigarette, to teach Tommy a lesson his dad made him chain-smoke the entire pack. Tommy's dad was counting on this economic principle to influence his son

Paper is a complementary good to a pen and a pencil is a substitute good to a pen

Which example correctly categorizes complementary goods and substitute goods

Price Elastic

You are all set to go to the outlet mall and buy Adidas Alphabounce Running shoes for $100, but when you get to the Adidas store the price has increased to $150. Instead of buying the Adidas you go over to the Nike store and purchase a pair of Nike Air Zoom Pegasus 33's for $110. Your demand for running shoes was

Price Inelastic

If a product's price change has little impact on the quantity demanded by consumers, the product is said to be

price inelastic

If your grandfather has a heart condition and take medicine to control his blood pressure and cholesterol, his demand for his medications would be considered

if not sold quickly supplies of Agricultural goods can become worthless

Agricultural goods differ from most manufactured goods because

shifted from elastic to inelastic when she found out about the tournament

Isabella has been looking for a new pair of soccer cleats but has been wearing her old pair waiting for cleats to go on sale at Dicks. At practice today she finds out her team has been given a last minute entry into a exclusive showcase tournament starting tomorrow. After practice Isabella drives to Dicks and buys the cleats even though they are not on sale. Her demand for the cleats

Regional Demand

States like Oregon and Washington lead the way in purchases of Electric Cars while states like Texas and Louisiana lead the way in purchases of Trucks. This is an example of

rises

The Law of Supply says that as the price rises for a good, the quantity supplied generally

Demand

The amount of a good or service that consumers are able and willing to buy at various possible prices

a Marginal Cost

The cost of producing one additional unit of production is known as

Real-income effect

The economic principle that individuals cannot keep buying the same quantity of a product if its price rises while their income stays the same is called the

Down

The law of demand says that as price of a good or service goes up quantity demanded goes

intersecting lines on a graph

The law of supply and demand can be best illustrated by