Economics

substitutes

goods that replace the other one/use instead

complements

goods used together

inferior good

demand down when consumer income up (eg instant noodles)

normal good

demand up when consumer income up (eg coffee: can affoard more now)

movement along the curve results from…

…change in price

shift of demand curve results from…

…change in non price determinant

producer surplus

when producers recieve more than the minimum price at which supplying the good would have been worthwhile

consumer surplus

when consumers buy below the maximum price at which buying the good would have been worthwhile

PES formula

%change in QS/%change in Price

PES meaning

higher price makes producers want to supply more (profit motive)

QS/D&Price increasing VS QS/D&Price decreasing

increasing: extension of supply/demand

decreasing: contraction of supply/demand

mobility definition in PES

how easily resources can be used for other things (easily: elastic PES)

when good A price increases, demand of good B (substitute)…

…increases

when good A price increases, demand for good B (complement)…

…decreases