Principles of Microeconomics Chapters 4-8

a group of buyers and seller of a particular good or service

a market in which there are many buyers and many sellers so that each has a negligible impact on the market price

the amount of a good that buyers are willing and able to purchase; a specific quantity or a unique quantity that will be purchased at a specific price

the claim that, other things being equal, the quantity demanded of a good falls when the price of a good rises

a table that shows the relationship between the price of a good and the quantity demanded

a graph of the relationship between the price of a good and the quantity demanded

a good for which, other things being equal, an increase in income leads to an increase in demand; right shift of demand curve

a good for which, other things being equal, an increase in income leads to a decrease in demand; left shift of demand curve

two goods for which an increase in the price of one leads to an increase in the demand for the other

two goods for which an increase in the price of one leads to a decrease in the demand for the other

the amount of a good that sellers are willing and able to sell; a specific quantity that will be offered for sale at a specific price

the claim that, other things being equal, the quantity supplied of a good rises when the price of the good rises

a table that shows the relationship between the price of a good and the quantity supplied

a graph of the relationship between the price of a good and the quantity supplied

a situation in which the market price has reached the level at which quantity supplied equals quantity demanded

the price that balances quantity supplied and quantity demanded

the quantity supplied and the quantity demanded at the equilibrium price

a situation in which quantity supplied is greater than quantity demanded

a situation in which quantity demanded is greater than quantity supplied

the claim that the price of any good adjusts to bring the quantity supplied and the quantity demanded for that good into balance

a measure of the responsiveness of quantity demanded or quantity supplied to a change in one of its determinants

a measure of how much the quantity demanded of a good responds to a change in the price of that good, computed as the percentage in quantity demanded divided by the percentage change in price

the amount paid by buyers and received by sellers of a good, computed as the price of the good times the quantity sold

a measure of how much the quantity demanded of a good responds to change in the consumers' income, computed as the percentage change in quantity demanded divided by the percentage change in income

a measure of how much the quantity of one good responds to a change in the price of another good, computed as the percentage change in quantity demanded of the first good divided by the percentage change in price of the second good

a measure of how much the quantity supplied of a good responds to change in the price of that good, computed as the percentage change in quantity supplied divided by the percentage change in price

a legal maximum on the price at which a good can be sold

a legal minimum on the price at which a good can be sold

the manner in which the burden of a tax is shared among participants in a market

the study of how the allocation of resources affect economic well-being

the maximum amount that a buyer will pay for a good

the amount a buyer is willing to pay for a good minus the amount the buyer actually pays for it

the value of everything a seller must give up to produce a good

the amount a seller is paid for a good minus the seller's cost of providing it

the property of a resource allocation of maximizing the total surplus received by all member of society

the property of distributing economic prosperity uniformity among the member of society

the fall in total surplus that results from a market distortion, such as tax

there are a large number of buyers and sellers; each buyer and/or seller is a price taker; entry and exit are free; products produced by all firms are either identical or homogeneous (having the same quality)

single firm producing a product or providing a service for which there are no readily made substitutes; price maker

a market structure in between pure monopoly and perfectly competitive; large number of buyers and sellers; each firm has a brand name of its own; example-retail industries

market structure when there are a few firms in the industry (collection of firms producing homogeneous or same products); example- automobiles, airlines

a list or a schedule of the various quantities that will be purchased at various prices

a schedule or a list of the various quantities that will be offered for sale a various prices (does not refer to any one quantity)