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ECONOMICS ch 4
vocabulary
| Term | Definition |
|---|---|
| demand curve | a graphic representation of a demand schedule |
| law of demand | an economic law that states that consumers buy more of a good when its price decreases and less when its price increases |
| market demand schedule | a table that lists the quantity of a good all consumers in a market will buy at every different price |
| demand schedule | a table that lists the quantity of a good a person will buy at each different price |
| income effect | the change in consumption resulting from a change in real income(you buy less pizza or fewer sneakers because the price went up) |
| substitution effect | when consumers react to an increase in a good's price by consuming less of that good and more of other goods (when the price of pizza rises people buy tacos and salads) |
| normal goods | a good that consumers demand when their income increases(you would buy more pizza if you start making more money) |
| inferior goods | a good that consumers demand less of as their income increases(you would buy less mac and cheese if you made more money) |
| A demand curve shift | because of income,consumer expectations, population, consumer tastes and advertising |
| revenue | income received by a government from taxes and non taxed sources |
| elastic | demand that is very sensitive to a change in price(affected by the availability of substitutions, the importance, the necessity and the change over time) |
| complementary goods | two goods that are bought and used together(skis and ski boots) |
Created by:
beth weir
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