Econ Unit 2 review

The lowest legal price that can be paid for a good or service

A need; if price rises a lot, demand will drop only a little

Determinant: Can increase, but also decrease supply if it doesn't work properly

Determinant: A price change in a product that goes with another product will affect demand

Can be overcome by lowering prices or holding back supply until demand increases

Determinant: Based on prediction of future prices, supply will be affected

In a surplus, what will happen to prices?

The monetary value of a product as established by supply and demand

Determinant: The amount an individual makes affects the demand curve

A change in price makes consumers feel richer or poorer

Determinant: Supply will change based on worker experience, such as job satisfaction

Determinant: a change in any item that goes into production will lead to a change in supply

Qd > Qs

Qd = Qs

Prices are relatively stable and Qd=Qs

When price goes up, demand goes down proportionally

The satisfaction of using/acquiring one more unit of a product

Can be overcome by rationing or increasing supply

Rent control is an example of a

Determinant: fads and popular opinion

Flexible, determined by buyers and sellers, help buyers and sellers to communicate

Law of supply: When prices are high, supply will be

The relationship between factors of production & the output of goods/services

Overhead; the price a business incurs even if the plant is idle and output is zero

A change in quantity demanded due to the change in the relative price of a product

Number of units sold x Price

Determinant: people moving in or out of a market affects the demand curve

In a shortage, what will happen to prices?

Which of the following is NOT a problem with a ration system?

Minimum wage is an example of a

The extra change due to adding one more worker (cooks, drywallers)

When prices go up, demand goes down proprortionally

Determinant: The change in price of a similar product affects the demand for another product (Coke & Pepsi)

Determinant: New businesses opening, or businesses closing, affect the supply curve

Determinant: Based on government rulings or mandates, supply will change

The total output a business needs to sell in order to cover its total costs

May contribute to a shortage

Can purchase be delayed; How much income does purchase take; Are there adequate substitutes

How quickly can the supplier adjust to changes in price determines

The maximum legal price that can be charged for a product

Qd < Qs

Determinant: If the government gives financial aid to a firm, supply will increase

May contribute to a surplus

Law of demand: When prices are high, demand will be

Determinant: Future predictions will affect the demand curve

To fix with a shortage, a government might decide everyone's fair share

A want; if prices rise a little, demand will drop a lot