Vocabulary
Goods
What are things one purchases which they can touch or hold?
Supply
What is producer's willingness and ability to produce goods and services at each price point
Demand
What is consumers' willingness and ability to purchase goods and services at each price point
Market Equilibrium
What is the point at which quantity supplied and demanded are equal?
Services
What are actions one does for someone else?
Law of Supply
What is producer's increasing willingness and ability to produce goods and services as their price increases
Law of Demand
What is consumers' increasing willingness and ability to purchase goods and services as they get less expensive
Shortage
What is excess demand?
(Quantity demanded exceeds quantity supplied at a given price)
Factors of Production
What are the resources required in the production of all goods and services
Determinants of Supply
What are factors that can cause the supply curve to shift to the left or right?
Determinants of Demand
What are the factors that can cause a demand curve to shift left or right
Surplus
What is excess supply?
(Quantity supplied exceeds quantity demanded at a given price)
Capital Resources
What are the tools and machines used in the production of goods and services
Effect on the supply curve for housing if building materials become les expensive
What is a rightward shift due to decreasing cost of inputs?
Effect on the demand curve for clothing if there is a recession and average income decreases in the US
What is a leftward shift due to decreasing consumer incomes
The effect on equilibrium price of housing if the price of building materials increases
What is an increase in the equilibrium price of housing due to decreased supply (cost of inputs)?
Markets
Places (physical or metaphorical) where producers and consumers exchange goods and services
Effect on the supply curve for Electric Vehicles if the US Government lowers the tax rate on EV producers
What is a rightward shift due to changing government policy?
The effect on a demand curve for Apple laptop computers if Apple decreases their price from $2000 to $1500
What is no change in the demand curve?
Quantity demanded changes due to the law of demand
What is a decrease in equilibrium price due to decreased demand (changes in number of consumers)?