Chapter 3 Microeconomics
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Created by:
SaraBailey on September 13, 2011
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17 terms
Terms | Definitions |
|---|---|
 Change in quantity of demanded | change in the quantity demanded of a good that is caused solely by a change in the price of that good |
| Law of demand | inverse relationship between price and quantity demanded of a good or service, ceteris paribus |
| Demand schedule | schedule showing the specific quantity of a good or service that people are willing and able to buy at different prices |
| Demand curve | curve that depicts the relationship between price and quantity demanded |
| Market demand | sum of all individual demands in a market |
| Supply schedule | schedule showing the specific quantity of a good or service that suppliers are willing and able to provide at different prices |
| Market-day supply | market situation in which the quantity of a good supplied is fixed, regardless of price |
| Supply curve | curve that depicts the relationship between price and quantity supplied |
| Excess supply | difference, at a particular price, between quantity supplied and quantity demanded, quantity supplied being the greater |
| Excess demand | difference, at a particular price, between quantity demanded and quantity supplied, quantity demanded being the greater. |
| Equilibrium price | price that equates quantity demanded to quantity supplied. If any disturbance from that price occurs, excess demand or excess supply emerges to drive price back to equilibrium. |
| Short run | time interval during which suppliers are able to change the quantity of some but not all the resources they use to produce goods and services |
| Change in demand | change in quantity demanded of a good that is caused by factors other than a change in the price of that good |
| Normal good | good whose demand increases or decreases when people's incomes increase or decrease |
| Substitute goods | goods that can replace each other. When the price of one increases, the demand for the other increases |
| Complementary goods | goods that are generally used together. When the price of one increases, the demand for the other decreases |
| Change in supply | change in quantity supplied of a good that is caused by factors other than a change in the price of that good |
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