Set: Economics Quiz 4,5,6,7

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All 29 Terms

Term Definition
demand the desire to own something and the ability to pay for it
ceteris paribus latin phrase that means "all other things held constant"
complements two goods that are bought and used together
substitutes goods used in place of one another
inelastic describes demand that is not very sensitive to a change in price
supply the amount of goods available
law of supply tendency of suppliers to offer more of a good at a higher price
supply curve graph of the quantity supplied of a good at different prices
diminishing marginal returns level of production in which the marginal product of labor decreases as the number of workers increases
subsidy a government payment that supports a business or market
price ceiling a maximum price that can be legally charged for a good or service
price floor a minimum price for a good or service
surplus situation in which quantity supplied in greater than quantity demanded; also known as excess supplied
shortage quantity demanded is greater than quantity supplied; also known as excess demand
search costs financial and opportunity costs consumers pay when searching for a good or service
supply shock sudden shortage of a good
rationing system of allocating scarce goods and services using criteria other than price
black market market in which goods are sold illegally
barrier to entry any factor that makes it difficult for a new firm to enter a market
start-up costs the expenses a firm must pay before it can begin to produce and sell goods
monopoly market dominated by a single seller
economies of scale factors that cause a producer's average cost per unit to fall as output rises
patent a license that gives the inventor of a new product the exclusive right to sell it for a certain period of time
price discrimination division of customers into groups based on how much they will pay for a good
monopolistic competition a market structure in which many companies sell products that are similar but not identical
non-price competition a way to attract customers through style, service, or location, but not a lower price
price war a series of competitive price cuts that lowers the market price below the cost of production
anti-trust laws laws that encourage competition in the marketplace
deregulation removal of some government controls over a market

Set Information

Terms 29
Creator thatwickedjumper
Created March 4, 2008
Groups None
Tag economics
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thatwickedjumper : Changed diminishing marginal returns → livel of production in which the marginal product of labor decreases as the number of workers increases to diminishing marginal returns → level of production in which the marginal product of labor decreases as the number of workers increases
thatwickedjumper : Changed inelastic → describes demand that is not very sensitive to a chane in price to inelastic → describes demand that is not very sensitive to a change in price
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Most Missed Words

  1. rationing → system of allocating scarce goods and services using criteria other than price - 5 misses
  2. economies of scale → factors that cause a producer's average cost per unit to fall as output rises - 5 misses
  3. monopolistic competition → a market structure in which many companies sell products that are similar but not identical - 5 misses
  4. substitutes → goods used in place of one another - 3 misses
  5. barrier to entry → any factor that makes it difficult for a new firm to enter a market - 3 misses
  6. non-price competition → a way to attract customers through style, service, or location, but not a lower price - 3 misses
  7. price war → a series of competitive price cuts that lowers the market price below the cost of production - 3 misses