Demand
Represents the cost of borrowing or reward for saving.
What are interest (rates)?
According to this economic law, as the price of a good increases, the quantity supplied will do this.
What is the Law of Supply?
A large firm sells products below cost to drive smaller competitors out of the market.
What is predatory pricing?
A market structure where there are many sellers offering identical products, ensuring no single firm can influence price.
What is pure competition?
The price at which quantity supplied equals quantity demanded in a market.
What is equilibrium?
An increase in the price of a good results in this type of movement along the demand curve.
What is a contraction?
An improvement in technology would likely shift the supply curve in this direction.
What is a shift to the right?
A group of companies working together to control supply and prices, harming competition.
What is a cartel?
Obstacles that prevent new firms from easily entering an industry, such as high startup costs or legal restrictions.
What are barriers to entry?
The government might regulate or break up monopolies to encourage this in a market.
What is competition?
The situation that describes an increase in the price of coffee, quantity demanded for milk decreases.
What is a change in price of a complimentary product?
A tax imposed by the government on producers, typically causing a decrease in supply.
What is an excise tax?
A business refuses to supply goods to certain customers or competitors as an unfair strategy.
What is exclusive dealing?
A type of market structure characterized by many firms selling similar but slightly differentiated products.
What is monopolistic competition?
A situation where one party in a transaction has more or better information than the other, leading to inefficiencies.
What is asymmetric information?
An increase in disposable income will cause this in a market.
What is a shift of the demand curve to the right?
The key factor that causes movement along a supply curve.
What is price?
This occurs when businesses agree to set prices at a certain level rather than competing fairly.
What is price fixing?
Products that are identical across different suppliers, making competition based solely on price.
What are homogeneous products?
The price of one product compared to another product.
What are relative prices?
When the price of a good falls, consumers feel richer and can buy more of it. This is known as what?
What is the income effect?
Government support provided to businesses to reduce costs and encourage production.
What is a subsidy?
The government body responsible for enforcing competition laws in Australia.
What is the Australian Competition and Consumer Commission (ACCC)?
The ability of a firm to influence the price of its product due to limited competition.
What is market power?
How suppliers react when there is a change in profitability.
What is a reallocation of resources?