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Economics Chapter 6
Question | Answer |
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equilibrium | the point at which quantity demanded and quantity supplied are equal |
disequilibrium | describes any price or quantity not at equilibrium; when quantity supplied is not equal to quantity demanded in a market |
excess demand | when quantity demanded is more than quantity supplied |
excess supply | when quantity supplied is more than quantity demanded |
price ceiling | a maximum price that can be legally charged for a good or service |
price floor | a minimum price for a good or service |
rent control | a price ceiling placed on rent |
minimum wage | a minimum price that an employer can pay a worker for an hour of labor |
surplus | Situation in which quantity supplied is greater than quantity demanded; also know as excess supply |
shortage | situation in which quantity demanded is greater than quantity supplied; also know as excess demand |
search costs | the financial and opportunity costs consumers pay when searching for a good or service |
supply shock | a sudden shortage of a good |
rationing | a system of allocating scarce goods and services using criteria other than price |
black market | a market in which goods are sold illegally |
spillover cost | cost of production that affect people who have no control over how much of a good is produced |