Econ chapter 4
Demand is the desire, —, and willingness to buy a product or service
Ability
Which is a likely complement to a tablet computer
Apps
Different amounts demanded at every price, causing the demand curve to shift to the left or the right
Change in demand
What is the main cause of a change in quantity demanded
Change in price
Movement along the demand curve showing that a different quantity is purchased in response to a change in price
Change in quantity demanded
Products related in such a way that an increase in the price of one reduces the demand for the other
Complements
A demand schedule is best described as —
Data
When the price of something increases, the quantity demanded
Decreases
Demand is elastic when a given change in price causes a relatively smaller change in quantity demanded
False
Prices act as a motivating influence, or —, that causes an individual to take action
Incentive
Portion of a change in quantity demanded caused by a change in a consumers income when the price of a product changes
Income effect
The law of demand states that the quantity demanded of a product varies — with its price
Inversely
A change in quantity demanded is represented by
Movement along the demand curve
The market demand curve that shows the — by everyone who is interested in purchasing a product at all possible prices
Quantities demanded
Products related in such a away that an increase in the price of one increases the demand for the other
Substitutes
Which of the following replaces a costly item with a less costly one
The substitution effect
Demand is unit elastic when a given change in price causes a proportional change in quantity demanded
True
demand elasticity is the extent to which a change in price causes a change in the quantity demanded
True
Which term refers to a changing price that causes a proportional change in total revenue
Unit elastic
To determine elasticity, which question would an economist ask?
What portion of the consumer's income is required for the purchase?
For which product is demand likely to be the most elastic?
a product with many adequate substitutes
Consider the term marginal utility. Which word is the best synonym for marginal?
additional
What is the relationship between income and demand
an increase in income increases demand
Why is the Law of Demand called a "law"?
because it has been demonstrated repeatedly
Prices for common vegetables tend to be elastic. Why?
because other vegetables are available
Why is the demand curve downward sloping?
because quantity demanded increases as price decreases
An economist performs a total expenditures test and finds that a change in price and a change in revenue move in opposite directions and concludes that the test shows __________.
demand is elastic
As people use more and more of a product, they encounter _______________.
diminishing marginal utility