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12 Cards in this Set
- Front
- Back
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What is a market?
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A place or situation where an economic exchange takes place.
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What is economic exchange?
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An exchange of goods or services for money.
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What are the major categories of markets?
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-Product
-Factor -Supply and Demand |
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Define demand.
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The ability and willingness to buy specific quantities of a good at alternative prices in a given time period, ceteris paribus
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Explain the assumption ceterus paribus.
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In economics it is assuming certain market variables to determine the market forecast.
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What is the relationship between price and quantity demanded?
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The quantity of a good demanded in a given time period increases as its price falls.
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Illustrate Demand schedule using a graph.
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What are the determinants of demand? Explain how each factor affects demand.
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Determinants of market demand include:
-Consumer tastes -Consumer income -Availability and prices of other goods -Consumer expectations -Number of buyers in the market |
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Explain the differences between changes in demand and changes in quantity demanded.
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Changes in quantity demanded: Movements along a demand curve in response to changes in price for the good
Changes in demand: Shifts of the demand curve due to changes in the determinants of demand, which change the relationship between price and quantity demanded |
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Illustrate Changes in Quantity-Demanded
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Illustrate Shift in Demand
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How do economists define market demand?
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Total quantities of a good or service people are willing and able to buy at alternative prices in a given time period.
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