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Macroeconomics Test 1
Terms in this set (47)
A group of buyers and sellers of a particular good or service
Many buyers and sellers that determine price and quantity. The goods offered for sale are exactly the same
When there is only one firm in a market whose only constraint is demand in the economy
Amount of a good that buyers are willing and able to purchase. It is determined only by price
The sum off all individual demands
How do you calculate the market demand curve?
Sum all of the individual demand curves horizantally
What does a shift right in the demand curve mean?
What does a shift left in the demand curve mean?
What factors lead to a shift in the demand curve?
1. Prices of Related Goods (Substitutes and Complements)
3. Number of Buyers
5. Expectations of future price
What factors lead to a shift in the supply curve?
1. Price of Inputs
2. Expectations future price
3. Number of Sellers
The amount of a good or service that sellers are able to sell.
What happens to quantity supplied when price rises?
Quantity supplied rises
An increase in income leads to an increase in demand of this good
A decrease in income leads to a decrease in demand of this good
An increase in the price of one good leads to an increase in demand of the other good
Recommended textbook explanations
Economics: Principles in Action
Arthur O'Sullivan, Steven M. Sheffrin
Economics: Concepts and Choices
William A. McEachern
Principles of Corporate Finance
Franklin Allen, Richard A. Brealey, Stewart C. Myers
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