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This states that when the price of a certain good rises, people tend to find alternatives that are less expensive.
What is the substitution effect?
If Miss Johnson quit a job where she annually made $40,000 to start a business whose expense was $20,000 and the total revenue was $15,000 during the first year, the opportunity cost for the year would equal this.
What is $45,000?
This good is expected to last at least three years.
What is a durable good?
This good is capable of being used in conjunction with another.
What is complementary?
This refers to the amount of satisfaction that results from a one-unit increase of a good.
What is marginal utility?
This refers to the satisfaction received from possessing a particular amount of a good.
What is total utility?
This refers to the direct benefit received by the owner of a good.
What is value in use?
This is the relationship between a good’s price and the amount that producers are willing to provide for consumers.
What is supply?
This is the relationship between a good’s price and the amount that people are willing to buy.
What is demand?
This is the term that refers to incentives given by the government to businesses to try to encourage production.
What is subsidies?
The factor that causes a change in quantity supplied within an existing supply is this.
What is price?
In a free market, they ultimately determines the distribution of goods.
Who are consumers?
The five factors that can change the demand for a good are...
Income, Tastes and preferences, Population, Consumer expectations, Prices of related good
The six factors that can cause a shift in a good’s supply are....
Technology, Resource prices, Prices of related goods, Number of sellers, Producer expectations, Government taxes, subsidies and regulations
Economists use the horizontal axis of a graph to represent this.
What is quantity supplied?
The purchase of inferior goods, such as used tires, does this as the average income rises.
What is decreases?
This is a graphic representation of the amount of goods purchased at different prices.
What is a demand curve?
This gives a person the willingness to trade certain goods for other goods that have greater personal value to him.
What is a profit motive?
A regulated price level set above equilibrium price is counter called this.
What is a price floor?
The result of a price ceiling would be this.
What is a shortage?
This is the part of an economy controlled by national, state, and local governments.
What is the public sector?
If the demand for snowmobiles remained steady while the supply grew larger; producers would be able to _____ prices.
What is decrease?
This is the total value of a business minus any liabilities.
What is equity?
This is a place where sellers and buyers exchange goods
What is a market?
This is the value of the best alternative that is foregone when a different alternative is taken.
What is opportunity costs?