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4-2 vocabulary jw

QuestionAnswer
States that the marginal benefit of using each additional unit of a product during a given period will decline. Law of dimishishing utility
The change in the amount that consumers will buy because the purchasing power of their income changes. Income effect
A change in the amount that consumers will buy because they buy substitute goods instead. Subsitution effect
An increase or decrease in the amount demanded because of change in price. change in quantity demanded
Occurs when something prompts consumers to buy different amounts at every price. Change in demand
Goods that consumers demand more of when their income rises. Normal Goods
Goods that consumers demand less of when their incomes rise. Inferior goods
Goods and services that can be used in place of each other. Substitutes
Goods that are used together, so a rise in demand for one increases the demand for the other. Complements
Created by: joannw15
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