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law of demand
a higher price leads to a lower quantity demanded; a lower price leads to a higher quantity demanded
demand
the amount of some good or service consumers are willing and able to purchase at each price; based on needs and wants; the relationship between a range of prices and the quantities demanded at those prices; refers to the curve
price
what a buyer pays for a unit of the specific good or service
quantity demanded
the total number of units purchased at a price; refers to a specific point on the curve
demand schedule
a table that shows the quantity demanded at each price
demand curve
a graph that shows the quantity demanded at each price
ceteris paribus assumption
demand curves relate the prices and quantities demanded assuming no other factors change
normal good
a good for which demand will increase when buyers’ incomes increase
inferior good
a good for which demand will decrease when buyers’ incomes increase
substitute goods
goods that can replace each other; when the price of a good increases, the demand for this will increase
complement goods
goods that are consumed together; when the price of a good increases the demand for this will decrease
