Supply & Demand
This occurs when quantity supplied equals quantity demanded.
What is equilibrium?
A business spends money on equipment instead of hiring workers. This is an example of this concept.
What is opportunity cost?
This measures responsiveness to price changes.
What is elasticity?
The total value of final goods and services produced in a country.This market structure contains many small businesses selling identical products.
What is GDP?
A tax placed on imported products.
What is a tariff?
When prices increase, producers are usually willing to sell more of this.
What is quantity supplied?
A student chooses to study instead of going to the beach. This is an example of this economic concept.
What is a trade-off?
Products with many substitutes usually have this type of demand.
What is elastic demand?
A continuous increase in overall prices over time.
What is inflation?
A government-imposed maximum legal price.
What is a price ceiling?
When demand increases and supply stays the same, equilibrium price will do this.
What is increase?
Resources are limited while wants are unlimited.
What is scarcity?
Necessities such as insulin usually have this type of demand.
What is inelastic demand?
The index commonly used to measure inflation.
What is the Consumer Price Index (CPI)?
Financial assistance provided by the government to businesses or industries.
What is a subsidy?
When quantity demanded is greater than quantity supplied.
What is a shortage?
When quantity demanded is greater than quantity supplied.
What is a shortage?
If consumers barely change their buying habits after a price increase, demand is considered this.
What is inelastic?
When inflation rises faster than wages, consumers experience this.
What is decreased purchasing power?
The government setting a minimum wage is an example of this type of policy.
What is a price floor?
If supply decreases while demand increases, what happens to equilibrium price?
What is a significant increase?
A new technology lowers production costs for companies. This causes the supply curve to move in this direction.
What is right?
A store lowers prices and total revenue rises. Demand is most likely this type.
What is elastic demand?
Two consecutive quarters of declining GDP is commonly known as this.
What is a recession?
When the government changes taxes or spending to influence the economy.
What is fiscal policy?