ECON VOCAB QUIZ #5

Quantity Demanded

The amount of a good or service that consumers are willing and able to buy at a specific price.

Demand

The quantity of a good or service that consumers are both willing and able to buy at various prices.

Demand Schedule

A table/graph that lists the quantities of a good that one person will buy at various prices.

Demand Curve

Shows the relationship between price and the quantity that buyers are willing and able to buy.

Market Demand

The sum of all the individual quantities demanded in a market.

Law of Demand

An economic law stating that as the price of a good service increases, the quantity demanded decreases, and vice versa.

Substitute Good

A product that satisfies the same basic want as another product. Substitute goods may be used in place of one another.

Change in Quantity Demanded

A movement along the curve caused strictly by a change in the price of the product.

Change in Demand

The entire demand curve shifts to a new position on the graph when quantities demand an increase or decrease at all prices.

Demand Shifters

Can cause a change in demand for a good or service.

Complementary Good

A product that is used or consumed jointly with another product. Such a good usually has more value when paired with its complement than when used separately.

Quantity Supplied

The amount of a good or service that producers are willing and able to offer for sale at a specific price.

Supply

The quantity of a good or service that producers are willing and able to offer for sale at various prices.

Supply Schedule

A table that shows the quantities supplied at different prices in a market.

Supply Curve

Shows the relationship between the price and the quantity that producers are willing and able to supply.

Market Supply

The sum of all the individual quantities supplied.

Law of Supply

An economic law stating that as the price of a good or service increases, the quantity supplied increases, and vice versa. Generally, producers are happier to offer goods and services at higher prices than at lower prices.

Revenue

The amount of money a firm receives in the course of doing business. Revenue is calculated by multiplying the quantity sold by the price.

Change in Quantity Supplied

A movement along the curve where the only factor that causes a change in quantity supplied is price.

Change in Supply

A change in the number of producers - can cause market supply at all prices to increase or decrease.

Supply Shifters

Factors that cause a change in supply.

(Cost of inputs, number of producers, conditions due to disasters or crises, technology, producer expectations, government policy)

Subsidy

A cash payment aimed at helping a producer to continue to operate.

Excise Tax

A tax on the manufacture or sale of a good.

Elasticity

A measure of the degree to which the quantity demanded or supplied of a good or service changes in response to a change in price.

Elasticity of Demand

A measure of consumers' sensitivity to a change in price.

Inelastic

Responds slightly or not at all to a change in price.

Elastic

Responsive to a change in price.

Unitary Elastic Demand

Occurs when the percentage change in price exactly equals the percentage change in quantity demanded.

Total Revenue Test

A business tool used to gauge the impact of prices on a producer's revenue.

Revenue Table

Lists the possible prices for a given product and the market demand at each price.

Total Revenue

Calculated by multiplying the quantity of a good sold by the price of the good.

Elasticity of Supply

A measure of the sensitivity of producers to a change in price.

Unitary Elastic Supply

The percentage change in price equals the percentage change in quantity supplied.

Supply Chain

The network of people, organizations, and activities involved in supplying goods and services to consumers.