Econ Unit 2 Review

E 2.9

100

This law states that consumers buy more at lower prices, and less at higher prices

The Law of Demand

200

This law states that producers make more goods at higher prices, and less at lower prices

The law of supply

300

This type of curve always slopes downwards

Demand Curve

400

This type of curve always slopes upwards

supply curve

500

This Latin terms meaning "all things being equal" considers variables to be constant to better describe market tendencies 

Ceteris Paribus

E 2.10

100

Movement along a supply or demand curve is usually influenced by this alone

Price

200

These examples describe how a demand curve can shift to the left and right respectfully

Variable response

Right (generally)= Rise in incomes, population, and popularity

Left (generally)= Decline in incomes, population, or popularity 

300

This term describes products that are generally bought and used together

Complimentary good

400

This term describes goods that are used in place of another good

Substitute 

500

These examples describe how a supply curve can shift to the left and right respectfully 

Variable 

Right (Generally)- New tech, trade agreements, and subsidies

Left (Generally)- Increased costs, tariffs, or regulation 

E 2.11

100

This term describes the sensitivity a price change can have on supply/demand

Elasticity

200

This term describes a product that is VERY sensitive to a change in price

Elastic

300

This term describes a product that is not very sensitive to a change in price

Inelastic

400

This formula helps you find the percentage change in quantity and price (state the formula)

(New quantity- old quantity)   X 100

            old quantity

(New price-old price)          X 100

          old price

500

These numbers determine whether or not the demand or supply is inelastic, elastic, and unitary elastic respectfully 

less than 1, more than 1, and exactly 1

E 2.12 & 2.13

100

This term describes the point in which supply and demand are balanced on price and quantity

Market Equilibrium

200

This term describes a situation in which the quantity supplied is more than the quantity demanded

Excess supply

300

This term describes a legal maximum that sellers can charge for a good

Price ceiling

400

This term describes a situation in which quantity demanded is more than quantity supplied

Excess demand

500

This term describes a legal minimum price that must be paid for a good or service

Price floors

E 2.14 & 2. 15

100

These term describes every point outside of a equilibrium point 

Disequilibrium 

200

The supply curve shifting this direction would cause the old equilibrium point to produce surpluses

Right

300

This example highlights a outside force that would shift the supply curve to the left, causing the old point of equilibrium to produce shortages

Variable

Ex: Tariffs imposed on computer chips from Taiwan

400

The demand curve shifting to the left would cause old point of equilibrium to produce these

surpluses

500

This example highlights a outside force that would shift the demand curve to the right, causing the old point of equilibrium to produce shortages

Variable

EX: People having more money to spend on retro video games