Term
| How does demand help societies determine WHAT, HOW, and FOR WHOM to produce? |
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Definition
Demand helps society determine what, how and for whom to produce things based on what the people want. If more people want a certain product more people will seek it out meaning that the demand will go up and companies will know what they need to buy and or make in the future. Demand is what shows companies what they need to produce to make more profit.
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Term
| Why do changes in consumer income and tastes affect movements of the demand curve? |
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Definition
Because the consumer income and tastes will always change and not everyone has the same taste and the same income. So if there is a job shortage the majority income will change meaning fewer people are able to afford to buy things so the demand curve will go down. But if most of the society has a stable job and spendable money to buy things then the demand curve will go up. Same with tastes and trends if a trend is going around that everyone wants then the demand curve will go up but with trends, at some point, they die and with that, the demand curve will also go down. |
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Term
Why is an understanding of elasticity important for a business?
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Definition
| Understanding that elasticity is very important for business because indicates how much of a good or service buyers consume when the price changes. It also tells buyers how much of a product they need to buy, and shows how well the product is selling. And if they need to change the price and either increase or decrease it based on the demand of that product. |
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Term
Why is an understanding of elasticity important for a business?
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Definition
| Understanding that elasticity is very important for business because indicates how much of a good or service buyers consume when the price changes. It also tells buyers how much of a product they need to buy, and shows how well the product is selling. And if they need to change the price and either increase or decrease it based on the demand of that product. |
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Term
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Definition
| the desire, willingness, and ability to buy a good or service. |
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Term
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Definition
| the branch of economics that studies the economy of consumers or households or individual firms |
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Term
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Definition
| an economy that relies chiefly on market forces to allocate goods and resources and to determine prices |
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Term
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Definition
| table showing quantities demanded at different possible prices |
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Term
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Definition
| a graph of the relationship between the price of a good and the quantity demanded |
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