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Demand
the amount of a good that is bought at a certain price under certain conditions; the relationship between a good’s price and the amount that people are willing and able to buy
Supply
quantity of a good at a certain price under certain conditions; relationship between a good’s price and the amount a producer supplies for a consumer
Value in Use
value gained from the direct benefit of using a good; this value varies from person to person
Value in Exchange
value gained exchanging for another good
Price
the amount of money an individual will pay for an item; value in exchange
Market Price
the price at which a good can be sold in a market; AKA “store price” of a good
Marginal Utility
the amount of satisfaction gained from using one unit of a good
Total Utility
the amount of satisfaction gained from using all units of a good
The Basic Law of Demand
Other things remaining equal, as the price of a good increases, the quantity demanded decreases
Income Effect
when the price of a good falls, more of that good will be bought; the opposite is true as well
Substitution Effect
less expensive goods will be substituted in the place of more expensive goods
Demand Schedule
a list that compares the price of a good with the quantity demanded
Demand Curve
graphic representation that compares the price of a good quantity demanded
The Basic Law of Supply
Other things remaining equal, as the price of a good increases, the quantity supplied also increases
Supply Schedule
a list of numbers that compares price with quantity supplied
Supply Curve
a graphic representation of the quantity of goods supplied at different prices
Bartering
What are most of AKA Trading value accomplished through
Price
What affects quantity demanded
Down and to the right
How will the demand curve always move
Up and right
How will the Supply Curve move
Note
Flashcard