Supply
As price increases, the quantity producers make ______.
Increases
This law states that as the price of a good goes up, the quantity demanded goes down.
Law of Demand
This point is where quantity demanded equals quantity supplied.
Equilibrium
Supply: A factory adds a new machine that speeds up the assembly process, allowing them to make more bicycles at a lower cost. What Shifter is Present?
Shift in Technology
This is a Government-set maximum price that prevents prices from rising too high.
Price Floor
As price falls, the quantity producers make ______.
Decreases
When graphing demand, which direction does the curve (or Line) go?
Down to the Ground
At equilibrium, this occurs when the quantity consumers want to buy exactly matches the quantity producers want to sell.
Equilibrium Quantity
Supply: Two new smoothie shops open in town, increasing the total amount of smoothies available. What Shifter is Present?
Shift in Number of Sellers
This is a government-set minimum price that prevents prices from falling too low.
Price Ceiling
When graphing supply, which direction does the curve (or line) go?
High to the Sky
Demand is the different ______ of goods that consumers are willing and able to buy at different prices.
Quantities
This happens to the equilibrium price when demand increases while supply stays the same.
Equilibrium price increases
Demand: The price of coffee rises, so more people buy tea instead. What Shifter is Present?
Shift in Price of Related Goods - Substitute
Farmers often receive these payments from the government to help keep their income stable when prices fall.
Subsidies
Supply is the different quantities of a good that a sellers are ______ and ______ to sell (produce) at different prices.
Willing, Able
Law Of Demand: There is an ______ relationship between price and quantity demanded.
Inverse
A government-set maximum price below equilibrium creates this market condition, where quantity demanded exceeds quantity supplied.
Shortage
Demand: Shoppers expect laptop prices to rise next month, so they buy laptops now. What Shifter is Present?
Shift in Future Expectations
A tax placed on a good to reduce consumption-like cigarettes or alcohol-is known as this.
Sin Tax/Excise Tax
This term describes how producers respond when the price of a good increases by supplying significantly more, and when it decreases by supplying significantly less. It measures how sensitive quantity supplied is to price changes.
Price Elasticity of Supply
This term refers to goods that see an increase in demand when consumer incomes rise, but a decrease in demand when consumer incomes fall.
Normal Goods
This event happens when a government-imposed minimum price is set above equilibrium, causing quantity supplied to exceed quantity demanded.
Surplus
Demand: A popular influencer promotes a new brand of sneakers. Suddenly, everyone wants them. What Shifter is Present?
Shift in Taste and Preference
This occurs when the government sets a price above or below the equilibrium and must purchase or dispose of excess goods to maintain that price, often seen in agricultural markets.
Government Price Support