The Law of the Land (Basics)
The law stating people buy more at lower prices and less at higher prices
What is the Law of Demand?
Changes in consumer income, preferences, expectations, or the number of buyers.
What are the Determinants of Demand?
The specific point where the supply and demand curves intersect.
What is the Equilibrium Price?
The degree to which the demand for a product can change.
What is Elasticity of Demand?
Labor, Capital, Natural Resources, and Entrepreneurial Talents are all examples of these.
What are Productive Resources?
The law stating producers increase quantity supplied at higher prices and lower it at lower prices.
What is the Law of Supply?
Changes in technology or the price of productive resources.
What are the Determinants of Supply?
This is created when the government sets a price floor
What is a Surplus?
Inelastic demand is most common for these types of goods.
What are Necessities?
This term refers to the "price" of labor.
What is Wage or Salary?
The willingness or ability to buy specific quantities of a good or service.
What is Demand?
This curve for Jelly Beans shifts left if the cost of sugar (a major ingredient) rises.
What is the Supply Curve?
A shortage occurs specifically when the price is at this level relative to equilibrium
What is Below Equilibrium?
This exists if a 10% change in price results in a 0% change in quantity demanded.
What is Perfectly Inelastic Demand?
Attending college is an example of an investment in this.
What is Human Capital?
The willingness or ability to bring a good to market.
What is Supply?
According to the graph in the guide, a headline about broccoli increasing IQ would shift this curve to the right
What is the Demand Curve?
When the price is above equilibrium, people will purchase this much
What is Less? (or a Surplus)
Between Bayer Aspirin and a medical exam, this one is more elastic because it has many substitutes.
What is Bayer Aspirin?
This term is most closely related to "satisfaction".
What is Utility?
The curve that indicates the maximum price buyers are willing and able to pay for a given quantity.
What is the Demand Curve?
A decrease in demand for a good or service will always lead to a decrease in these.
What are the materials or products used to create it?
Prices provide signals to these two specific market participants.
Who are Consumers and Producers?
If demand for golf is relatively inelastic and fees go up, people will play this much
What is about the same amount?
Lifetime earnings for a worker depend primarily on this.
What is their Market Value?