Demand
When a good's price decreases, demand will...
Increase
Measuring the reaction of consumers after a good's change in price is called
Elasticity
When a good's price increases, supply will
Increase
A cost that does not change
Fixed Cost
The point where supply and demand is equal
Equilibrium
An increase in demand will cause the curve to shift in which direction?
Right
If you stop buying a good when a price changes, it is said your demand is
Elastic
A decrease in supply, will cause the curve to shift to the...
Left
True or False: Cost of repairs are a variable cost
False
The points where supply and demand are not equal
Disequilibrium
When we replace one good with another because the price of that good went up is called
The substitution effect
Name three things with inelastic demand
Gas, Water, Electricity
What makes supply of a good elastic?
It can react quickly or be flexible when price changes
How do we calculate profit?
Revenue minus costs
True or False: When a market is in disequilibrium, it tries to get back to equilibrium
True
When our demand changes because we got a raise or lost our job is called
The income effect
The definition of revenue is
$ made from selling your good
True or False: Farm goods have elastic supply
False
A rise in costs will do what to supply
Decrease it
Minimum wage is an example of a price floor or price ceiling
Price Floor
In economics, two goods that are bought and used together are called
Complements
Availability of substitutes will make demand
Elastic
Why can businesses that provide a service be more elastic than others?
Can be easily expanded or reduced
What is marginal cost?
The additional cost of producing one more good
A sudden decrease or drop in supply is called a...
Supply shock