Term
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Definition
a group of buyers and sellers of a particular good or service
-buyers determine demand
-sellers determine supply
-can be organized or unorganized |
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Definition
| a market in which there are many buyers and many sellers so that each has a negligible impact on the market price |
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Term
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Definition
(assume in this chapter)
1) the goods offered for sale are all exactly the same
2) the buyers and sellers are so numerous that no single buyer or seller has any influence over the market price |
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Term
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Definition
| buyers and sellers in perfectly competitive markets who accept the price the market determines |
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Term
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Definition
| a market with only one seller who sets the price |
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Term
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Definition
the amount of a good that buyers are willing and able to purchase
-negatively related to price
(price of good goes up, demand goes down--price of good goes down, demand goes up) |
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Term
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Definition
| the claim that, other things equal, the quantity demanded of a good falls when the price of the good rises |
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Term
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Definition
| a table that shows the relationship between the price of a good and the quantity demanded |
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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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Term
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Definition
| the sum of all the individual demands for a particular good or service |
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Term
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Definition
| any change that increases the quantity demanded at every price; shifts the demand curve to the right |
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Term
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Definition
| any change that reduces the quantity demanded at every price; shifts the demand curve to the left |
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Term
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Definition
| a good for which, other things equal, an increase in income leads to an increase in demand |
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Term
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Definition
| a good for which, other things equal, an increase in income leads to a decrease in demand |
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Term
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Definition
| two goods for which an increase in the price of one leads to an increase in the demand for the other |
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Term
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Definition
| two goods for which an increase in the price of one leads to a decrease in the demand for the other |
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Term
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Definition
the amount of a good that sellers are willing and able to sell
-positively related to price
(price of goods goes up, supply of goods goes down-price of goods goes down, supply of goods goes down) |
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Term
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Definition
| the claim that, other things equal, the quantity supplied of a good rises when the price of the good rises |
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Term
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Definition
| a table that shows the relationship between the price of a good and the quantity supplied |
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Term
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Definition
| a graph of the relationship between the price of a good and the quantity supplied |
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Term
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Definition
| sum of the supplies of all sellers |
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Term
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Definition
| any change that raises quantity supplied at every price; shifts the supply curve to the right |
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Term
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Definition
| any change that reduces the quantity supplied at every price; shifts the supply curve to the left |
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Term
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Definition
| a situation in which the market price has reached the level at which quantity supplied equals quantity demanded |
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Term
Equilibrium Price
(Market Clearing Price) |
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Definition
| the price that balances quantity supplied and quantity demanded |
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Term
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Definition
| the quantity supplied and the quantity demanded at the equilibrium price |
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Term
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Definition
| a situation in which quantity supplied is greater than quantity demanded |
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Term
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Definition
| a situation in which quantity demanded is greater than quantity supplied |
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Term
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Definition
| the claim that the price of any good adjusts to bring the quantity supplied and the quantity demanded for that good into balance |
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