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the branch of economics that studies the economy of consumers or households or individual firms
economic growth, full employment, economic efficiency, price level stability, economic fredom, an equitable distribution of income, economic security, balance of trade
the economic condition when everyone who wishes to work at the going wage-rate for their type of labor is employed
steady growth in the productive capacity of the economy (and so a growth of national income)
economic system that relies on habit, custom, or ritual to decide questions of production and consumption of goods and services
an economy that relies chiefly on market forces to allocate goods and resources and to determine prices
law of demand
consumers buy more of a good when its price decreases and less when its price increases
when consumers react to an increase in a good's price by consuming less of that good and more of other goods
a table that shows the relationship between the price of a good and the quantity demanded
change in the quantity demanded
a movement along the demand curve that occurs in response to a change in price
determinants of demand
consumer tastes, the number of buyers in the market, the money incomes of consumers, the prices of related goods, and price expectations
two goods for which an increase in the price of one leads to an increase in the demand for the other
a table that shows the relationship between the price of a good and the quantity supplied
change in the quantity supplied
a movement along the supply curve that occurs in response to a change in price
change in supply
resource prices, production techniques, taxes or subsidies, the prices of other goods, price expectations, or the number of sellers in the market
property owned by individuals or companies, not by the government or the people as a whole
The freedom to own property, to make a profit, and to make choices about what to produce, buy, and sell
Growth becomes negative for a variety of reasons, including technological substitution. Within a declining industry, the degree of rivalry among established companies usually increases. The greater the exit barriers, the harder it is for companies to reduce capacity and the greater is the threat of severe price competition. (falling demand = excess capacity, growth becomes negative)
role of consumer as ruler of market when deternmining the types of goods and services produced
an organization that is authorizrd by law to carry on an activity but treated as though it were a single person
the liability of a firm's owners for no more than the capital they have invested in the firm
payments by the government to individuals for which the government does not receive a new good or service in return
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