Unit 2 Test: Supply and Demand

A minimum price for a good or service

A minimum price that an employer can pay a worker for one hour of labor

The total amount of money a company receives by selling goods or services

When quantity demanded is more than quantity supplied

A measure of the way quantity supplied reacts to a change in price

Consumers will buy more of a good when its priceis lower and less when its price is higher

a large number of firms all produce the same product and no single firm controls supply/prices

Selling a product below cost for a short period of time to drive competitors out of the market

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

A market in which a single seller dominates

Describes demand/supply that is very sensitive to a change in price

Factors that cause a producer’s average cost per unit to fall as output rises

A chart that lists how much of a good a supplier will offer at various prices

the demand for a product or service is equal to the supply of that product or service

The additional income from selling one more unit of a good; sometimes equal to price

Any factor that makes it difficult for a new firm to enter a market

Goods that are used in place of one another

The expenses a new business must pay before it can begin to produce and sell goods

A good that consumers demand less of when their incomes increase

Producers offer more of a good as its price increases and less as its price falls

When quantity supplied is more than quantity demanded

Describes demand whose elasticity is exactly equal to one

The amount that a supplier is willing and able to supply at a specific price

A measure of how consumers respond to price changes

The amount of goods available

The sum of fixed costs plus variable costs

The change in consumption that results when a price increase causes real income to decline

Any price or quantity not at equilibrium 

A product, such as milk, that is considered the same no matter who produces or sells it

A good that consumers demand more of when their incomes increase

A factor that can change

A market structure in which a few large firms dominate a market

A table that lists the quantity of a good aperson will buy at various prices in a market

Describes demand/supply that is not very sensitive to price changes

The cost of producing one more unit of a good

A maximum price that can legally be charged for a good or service

A chart that lists how much of a good all suppliers will offer at various prices

The ability of a company to control prices and total market output

A product that is popular for a short period of time

A tax on the production or sale of a good

When two or more companies join to form a single firm

A market structure in which many companies sell products that are similar but not identical

When consumers react to an increase in a good’s price by consuming more of a substitute good

Two goods that are bought and used together

Laws that encourage competition in the marketplace

What does Ceteris Paribus mean?

A government payment that supports a business or market

A cost that rises or falls depending on the quantity produced

The total cost divided by the quantity produced

A cost that does not change, no matter how much of a good is produced