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| when the supply of an item can't meet the demand |
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| the fundamental economic questions |
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-what do I produce?
-how do I produce it?
-for whom do I produce it? |
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| no such thing as a free lunch |
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| diminishing marginal utility |
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| the first unit of consumption of a good or service yields more utility than the second and subsequent units, with a continuing reduction for greater amounts |
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| a revolutionary socialist movement to create a classless, moneyless[1][2] and stateless social order structured upon common ownership of the means of production, as well as a social, political and economic ideology that aims at the establishment of this social order |
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| Capitalism is an economic system based on the private ownership of capital goods and the means of production, with the creation of goods and services for profit.[1][2] Elements central to capitalism include capital accumulation, competitive markets, and a price system |
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| four components of capitalism |
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| equations, exponents, polynomials and like terms |
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| demand is an economic principle that describes a consumer's desire |
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| In economics, the demand schedule is a table of the quantity demanded of a good at different price levels. Thus, given the price level, it is easy to determine the expected quantity demanded. This demand schedule can be graphed as a continuous demand curve on a chart having the Y-axis representing price and the X-axis representing quantity. |
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| In economics, the law states that, all else equal, as the price of a product increases, a lower quantity will be demanded; likewise, as the price of a product decreases, a higher quantity will be demanded. |
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| law of diminishing marginal utility |
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| A law of economics stating that as a person increases consumption of a product - while keeping consumption of other products constant - there is a decline in the marginal utility that person derives from consuming each additional unit of that product. |
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| Quantity demanded is the total amount of goods which individuals want and are able to buy |
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| 6 factors that change demand |
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(1) Tastes and preferences of the consumer
(2) Income of the people
(3) Changes in prices of the related goods
(4) Future expectation
(5) Population
(6) Income distribution |
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| alternate goods that offer simaler traits |
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| a good with a negative cross elasticity of demand, in contrast to a substitute good.[1] This means a good's demand is increased when the price of another good is decreased |
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| The extent to which a change in price causes a change in the quantity demand |
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| elastic vs inelastic goods |
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elastic goods can be changed (luxuries)
inelastics goods cannot (gas,food) |
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| – A change in price creates a generally larger change in quantity demand |
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| A change in price does not create substantial change in quantity demand |
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| The amount of a product that would be offered for sale at all possible prices |
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| A table which contains values for the price of a good and the quantity that would be supplied at that price. If the data from the table is charted, it is known as a supply curve. |
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The principle that suppliers will normally offer more for sale at high prices and less at low prices
o P(UP)QS(DOWN)
o P(DOWN)QS(UP) |
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| the amount of goods or services that are supplied at a given market price. |
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| A situation in which prices are relatively stable, and the quantity of goods or services supplied is equal to the quantity demand |
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oAlmost always have a shortage
oWhen price goes down we want more and suppliers want less |
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o Makes it illegal to drop price lower than government standard (minimum wage)
o Creates a surplus
oMakes it illegal to drop price lower than government standard (minimum wage)
oCreates a surplus |
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