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Market structures are also included. Be sure to study how to graph both a supply and demand schedule. I hope this helps!

Supply-

the amount a seller is willing to sell at different prices at a particular place and time.

What is the supply schedule always going to look at?

price and quantity.

Curve-

line graph showing supply or demand.

Law of supply-

as price goes up, supply goes up.

Elasticity of supply-

change in supply following a change in price.

3 types of elasticity of supply?

1. inelastic.
2. elastic.
3. perfectly inelastic.

Inelastic (supply)-

small change in supply following a price.

Elastic (supply)-

big change in supply following a change in price.

Perfectly inelastic (supply)-

no change in supply regardless of a change in price.

Non-price determinant (supply)-

changing something other than price.

4 non-price determinants (supply)?

1. change in the number of producers.
2. other profit opportunity.
3. change in production cost.
4. future expectations.

Demand-

ability AND willingness to buy.

Law of demand-

as price goes up, demand goes down.

Elasticity of demand-

change in demand following a change in price.

2 types of elasticity of demand?

1. inelastic.
2. elastic.

Inelastic (demand)-

small change in demand following a change in price.

Elastic (demand)-

big change of demand following a change in price.

Non-price determinant (demand)-

shifts the curve.

7 non-price determinants (demand)?

1. price of substitute goods.
2. cost of a complimentary good.
3. change in income.
4. change in taste.
5. change in weather.
6. change in number of buyers.
7. future expectations.

Surplus-

too much of something.

Shortage-

didn't produce enough.

Equilibrium point-

all goods offered.

Market structures-

how we organize business.

4 types of market structures?

1. perfect competition.
2. pure monopoly.
3. monopolistic competition.
4. oligopoly.

Perfect Competition-

buy and sell without limits.

4 characteristics of perfect competition?

1. many buyers or sellers.
2. goods and services are similar or identical.
3. consumer has knowledge of product.
4. entrance to and exit from market are easy.

Pure monopoly-

one provider.

3 characteristics of pure monopoly?

1. product is unique.
2. entrance to and exit are extremely difficult.
3. only one provider.

Monopoly is mostly _______ in the US.

illegal.

4 legal monopolies?

1. government.
2. natural monopoly.
3. technological.
4. geographic.

Monopolistic competition-

buying something where you've always boughten it.

4 characteristics of monopolistic competition?

1. many buyers and sellers.
2. similar but differentiated product.
3. consumer knowledge is good.
4. entrance to and exit are relatively easy.

Oligopoly-

a few firms control the market.

5 characteristics of oligopoly?

1. 3 or 4 firms control at least 70% of market.
2. similar products differentiating through advertising.
3. information is readily available.
4. barriers to enter and leave market.
5. non-price competition.

Who wrote the wealth of nations?

Adam Smith.

What is the basic idea of the wealth of nations?

laissez-faire.

Laissez-faire-

leave it alone.

What did Smith say?

government should stay out.

Infrastructure-

basic services that holds a country together.

Invisible hand-

contains infrastructure and government is involved with just the economy.

What occurred in the late 1800's?

monopolies formed.

Monopoly-

where I control production.

Sherman Anti-Trust Act-

illegal to restrain trade in anyway.

Clayton Anti-Trust Act-

1914, made monopoly illegal.

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