Unit 2 Econ Vocab

Demand

The amount of a good or service that customers are willing and able to purchase at all prices

Law of Demand

The idea that price and quantity demanded of a good or service are inversely related

Change in Q-Demand

A shift in the amount of a good or service demanded that is achieved by a change in price

Change in Demand

A shift in the amount of a good or service that is demanded at all prices

Substitutes

Goods or services that are used in place of a different good or service

Complements

Goods or services that are used alongside of a different good or service

Supply

The amount of a good or service that businesses are willing and able to sell at all prices

Law of Supply

The idea that price and quantity supplied of a good or service are directly related

Quantity Supplied

The amount of a good or service that sellers are willing and able to sell at one specific price

Change in Q-Supplied

A shift in the amount of a good or service supplied that is achieved by a change in price

Change in Supply

A shift in the amount of a good or service that is supplied at all prices

Subsidy

Money given to the sellers of a good or service, typically as an incentive to increase or maintain production levels

Equilibrium Price

The price for a good or service at equilibrium

Equilibrium Quantity

The quantity of a good or service available at equilibrium

Surplus

A situation in which the quantity supplied of a good or service is greater than the quantity demanded

Shortage

A situation in which the quantity demanded of a good or service is greater than the quantity supplied

Price Ceiling

A maximum price allowed for a good or service

Price Floor

A minimum price allowed for a good or service

Perfect Competition

A market structure in which many sellers are supplying identical goods or services.  Also called Pure Com__ti___n

Monopolistic Competition

A market structure in which many sellers are supplying goods or services that are different in inconsequential ways

Non-price Competition

When businesses in a given market compete on style, service or location instead of competing with price

Oligopoly

A market structure in which a few sellers control the market for a good or service

Collusion

When businesses in a market work together to fix prices to increase their profits

Monopoly

A market structure in which only one business exists in the market for a good or service

Sole Proprietorship

A business type in which one person has total control and ownership of the business

Unlimited Liability

When the owners of a business are personally responsible for all of the debts of the company

Partnership

A business type in which two or more people share control and/or ownership of the business

Corporation

A business type in which control and ownership of a business is determined through ownership of share of stock

Stock

Partial ownership of a corporation that allows an investor to participate in the decisions made for that corporation.  Also called Sh____ of S_ock

Dividend

When the profits of a corporation are divided up and distributed according to the percentage of the company’s stock owned by an individual