Details Title: Chap 3/4 of Krugman Wells Description: 2nd Exam Material Total Flash Cards: 22 Created: 02/10/2009 20:23:34		New Users: To study from this flashcard set, or to create your own your own study flash cards, REGISTER HERE. Existing Users: CLICK HERE. Additional Economics Flashcards
Cards in this set: Term what's a competitive market? Definition the name of a market in which there are many buyers and sellers of the same good or service Term what's the supply and demand model? Definition the name of the model of how a competitive market works Term what's a demand schedule? Definition the name of agraphical representation of the demand schedule; shows how much of a good or service customers want to buy at any given price Term what's a demand curve? Definition a graphical representation of the demand sched. It shows how much of a good or service consumers want to buy@any given price Term what's the quantity demanded? Definition the name of the actual amount customers are willing to buy at a specific price Term what's the law of demand? Definition the law that says a higher price for a good, other things equal, leads people to demand a smaller quantity of the good Term what's a shift of the demand curve? Definition the name of a change in the quantity demanded at any given price, (demand curve moves to new position) Term what's movement along the demand curve? Definition the name of the change in the quantity demanded of a good that is the result of the good's price Term what are substitutes? Definition what two goods are if a fall in the price of one makes consumers less willing to buy the other Term what are complements? Definition what two goods are if the fall in the price of one makes people more willing to buy the other good Term what's a normal good? Definition a good that's demand increases when income increases Term what's an inferior good? Definition a good that's demand decreases when income increases Term wat is the quantity supplied? Definition the actual amount of a good or service ppl are willing to sell at some specific price Term what's a supply schedule? Definition what shows how much of a good or service would be supplied at different prices Term what's a supply curve? Definition what shows graphically how much of a good or service ppl are willing to sell at any given price Term what is a shift of the supply curve? Definition a change in the quantity supplied of a good or service at any given price. It is represented by the change of the original supply curve to a new position Term what is an input? Definition a good that is used to produce another good Term what's a quota? Definition an upper limit on a quantity that can be bought or sold set by the gov Term wats quota rent Definition the diff between the demand price and supply price at the quota limit; is equal to the market price of the license when the license is traded Term wats a price ceiling? Definition a government-set maximum price that sellers are allowed to charge for a good; a form of price control Term how does an increase in supply affect the supply curve and equilibrium? Definition supply curve moves to right, equilibrium price down but price moves up Term often fluctuations in markets involve shifts of both the supply and demand curves, how are these predictable? Definition both shift in same direction--change in quantity is predictable but price is not when opposite--change in prices is predictable but quantity is not when simultaneous shifts of d&s--the greater shifter has a greater effect on price and quantity