Vocab
This is where quantity supplied equals quantity demanded.
What is equilibrium?
This type of business earns the most total revenue but is the least common.
What is a corporation?
An increase in population will cause this curve to shift right.
What is demand?
A change in price alone causes this type of change on the graph.
What is movement along the curve?
Diminishing marginal returns begin at the point where this starts to decrease.
What is marginal product?
This law states that as price increases, quantity demanded decreases.
What is the Law of Demand?
These businesses make up the most in number but earn the least revenue.
Answer: What are sole proprietorships?
If the price of a complementary good increases, demand for the related product will…
What is decrease?
This is when the price of one good rises and consumers switch to a cheaper alternative.
What is the substitution effect?
Two goods that are used together, like cereal and milk, are called this.
What are complementary goods?
When quantity demanded exceeds quantity supplied, this occurs.
What is a shortage?
This is a major disadvantage of a sole proprietorship involving personal risk.
What is unlimited liability?
Resources used to produce goods and services, like labor, raw materials, and machines are all examples of...
What are inputs?
If the equilibrium price of a dozen donuts is $8, and the government sets a limit on the price of donuts at $5 a dozen. This limit is called...
What is a price ceiling?
This term describes the satisfaction or usefulness a consumer gets from a good.
What is utility?
A minimum legal price is called this.
What is a price floor?
This type of business is legally treated as a single entity but owned by many people.
What is a corporation?
If a product becomes more popular, this determinant causes demand to increase.
What are tastes/preferences?
If both supply and demand decrease, equilibrium quantity will…
What is decrease?
When the demand or the supply curve shifts to left, we know that the supply or demand has...
What is decreased?
This occurs when additional workers increase output, but at a decreasing rate.
What is the Law of Diminishing Marginal Returns?
This business structure allows owners to specialize in different roles.
What is a partnership?
If producers expect prices to drop in the future, supply today will…
What is increase?
The demand curve is sloped downward due to the relationship between price and quantity demanded. This opposite relationship is called...
What is inverse?
If the 2nd worker adds 10 units and the 3rd adds 5 units, this has occurred.
What is diminishing marginal returns?