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17 terms

definitions

STUDY
PLAY
demand
the desire to own something and the ability to pay for it
law of demend
consumer s buy more of a good when its price decreasesand less when its price increases
substitutuon effect
when consumers react to an increase in a global price by consuming less of that good and more of other goods
income effect
the change in consumption resulting from a change in real income
demand schedule
a table that liststs the quantitiy of a good person will buy at each differnt price
market demand schedule
a tbale that lists the quantitty of a good all consumers in a market will buy at each differnt price
demand curve
a graphic representation of a demand schedule
ceteris parinus
a lation phrase that means all other things held constant
normal good
a good that consumers demand more of when there incomes increase
inferiior good
a good that consumers demand less of when their incomes increase
complements
two good that are bought and used together
SUBSTITUTES
goods used in place of one another
elasticity of demand
a measure of how consumers react to a change in price
inelastic
describes demand that is not very sensitive to a change in price
elastic
describes demand that is very sensitive to a change in price
unitary elastic
describes demand whose elasticity is exactly equal to 1
total revenue
the total amount of money a firm recieves by selling good sand services