Unit 3: Supply, Demand, Prices Flashcards

Vocabulary flashcards created from Unit 3 lecture notes covering concepts of supply, demand, costs, government actions, and market regulations.

Supply

The amount of goods and Services avaliable

Law of Supply

Producers offer more of a good or service as its prices increases and less as it falls

Increased marginal Returns

When the addition of a variable input (like labor) to a fixed input (like capital) enables the variable input to be more productive

Fixed Costs

Cost that does not change

Variable Costs

Rise or fall depending on the quantity produced, such as the cost of raw materials

Subsidy

A government payment that Supports a business or market, usually given to food Suppliers

Excise Tax

Tax on the production or sale of good, used to discourage the sale of goods deemed harmful to the public good like Cigarettes, alcohol, et

Regulation

Government intervention in a market that affects the price, quanity, quality of goods

Demand

The desire to own something and the ability to pay for it

Law of Demand

When a good's price is lower, Consumers will buy more

Ceteris Paribus

"All other things held constant" in a perfect world; used in economics to role out the possibility of, "Other" factors changing