1.2.3 Markets
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9 Terms
1
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What is supply?
The amount of product a business is willing and able to provide at a given price
2
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What is demand?
The amount of product customers are willing and able to buy at a given price
3
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What is the market clearing price?
The equilibrium where demand and supply are equal
4
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What is a surplus?
Where supply exceeds demand
5
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What can cause a surplus?
The price being too high
6
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What is a shortage?
Where demand exceeds supply
7
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What can cause a shortage?
The price being too low
8
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If price increases, what happens to quantity in terms of supply?
It increases
9
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If price increases, what happens to quantity in terms of demand?
It decreases