Vocab
As price goes up, _____________ decreases.
What is quantity demanded (the law of demand)?
This is caused by a rightward demand shift.
A elasticity coefficient of less than 1.
What is price inelastic?
An excise tax on the producer or consumer will make supply/demand do this.
What is fall?
The word marginal should be replaced with this word.
What is additional?
As price goes up, _____________ increases.
What is quantity supplied (the law of supply)?
An increase in the wages of automotive workers does this to the supply curve for cars.
What is a leftward shift?
What is elastic?
The economic loss of efficiency.
What is dead weight loss?
The only thing that can shift quantity supplied/demanded.
What is price?
The study of the pros and cons of doing something one more time.
What is marginal analysis?
Workers at a chemical factory face risk of disease. New technology in their equipment causes this risk to go to zero, leading to this.
What is a rightward supply shift?
What is 2.5, elastic?
Total tax revenue.
What is amount of tax*quantity?
If equilibrium price is 5 dollars and there is a binding price ceiling set at 4 dollars, there is a ___________.
What is a shortage?
The difference between what consumers are willing to pay for units of a good and the price consumers actually pay for units of the good.
Changes in the demand for and the supply of a good that would necessarily lead to a decrease in the equilibrium quantity of the good in the market in the short run
What is
Demand: Decrease
Supply: Decrease
If supply for peaches in Georgia was disrupted by a drought, and revenue increases, the demand for peaches must be.
What is inelastic?
What is split between the producer and the consumer?
To maximize utility, a consumer with a fixed budget will purchase quantities of goods so that the ratios of the marginal utility of each good and their what are equal?
What are prices? (marginal utility per dollar spent)
The demand curve for a normal good slopes down because of...
What are the income and substitution effects?
A coffee company agrees with their union for lower wages, and the price for a substitute for coffee goes down. This happens to price and quantity.
What is price goes down and quantity is indeterminate?
Cross price elasticity of demand for apples and oranges measures the %change in quantity demanded of apples in response to this.
What is the %change price of oranges?
The new quantity intersecting with the supply curve, the new quantity intersecting with the demand curve and the supply and the demand curve.
What are the intersections of dead weight loss?
The relationship between price and revenue for inelastic demand.
What is as price goes up, total revenue goes up? As price goes down, total revenue goes down
The opposite is true for elastic demand (price up, total revenue down; price down, TR up)