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change in quantity demanded
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movement along the demand curve showing that a different quantity is purchased in response to a change in price.
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demand
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the desire to own something, the ability and willingness to pay for it.
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Elasticity
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a measure of the responsiveness of quantity demanded or quantity supplied to a change in one of its determinants.
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3 kinds of elasticity?
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elastic, Inelastic, and unit
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microenomics
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branch of economic theory that deals with behavior and decision making by small units such as individuals and firms
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What are the 6 determinants of demand?
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consumer income, consumer taste, price of substitutes, price of compliments, change in expectations, and number of consumers.
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demand schedule
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list showing the quantity demanded at all possible prices that might prevail in the market at a given time.
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Demand Graph (Demand Curve)
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a graph showing the relationship between the price of a certain good and the quantity of that good that is demand at that price.
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Law of Demand
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rule stating that more will be demanded at lower prices and less at higher prices.
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what type of relationship do price and quantity demanded have?
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an inverse relationship
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change in demand
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different amounts of a product are demanded at every price, causing the demand curve to shift to the left or the right.
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Change in Demand vs. Change in Quantity Demanded
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A change in demand is when the whole curve shifts either left or right and a change in quantity demanded is movement along the demand curve due to a change in price.
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diminishing marginal utility
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decrease in additional satisfaction or usefulness as additional units of a product are acquired.
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Elastic v Inelastic
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with elastic demand, demand changes more than the other variables (most often price) where as with inelastic demand, demand does not change even when another economic variable changes.
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Increase in demand
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An increase in demand means that consumers plan to purchase more of the good at each possible price. Demand curve will shift right.
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Decrease in demand
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A decrease in demand means that consumers plan to purchase less of the good at each possible price. Demand curve will shift left.
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