| A | B |
|---|
| supply | schedule of quantities offered for sale at all possible prices in a market |
| Law of demand | rule stating that more will be demanded at lower prices and less at higher prices; inverse relationship between price and quantity demanded. |
| supply schedule | tabular listing showing the quantities produced or offered at each and every possible price and every possible price in the market. |
| supply curve | graphical representation of the quantities produced at each and every possible price in the market. |
| market supply curve | supply curve that shows the quantities offered at various prices by all firms that sell the product in a given market. |
| quantity supplied | amount offered for sale at a given price; point on the supply curve. |
| change in supply | is a change in the quantity that will be supplied at each and every price. |
| fixed cost | cost of production that does not change when output changes |
| variable cost | production cost that varies at output changes; labor, energy, raw materials. |
| total cost | variable plus fixed cost; all costs asociated with production |
| marginal cost | extra cost of producing one additional unit of production |
| total revenue | total receipts; price of goods sold times quantity sold. |
| marginal revenue | extra revenue from the sale of one additional unit of output |
| marginal analysis | decision making that compares the extra cost of doing something to the extra benefits gained |
| break even point | production needed if the firm is to recover its costs; production level where totoal costs equals total revenue. |
| profit maximizing quantity of output | level of production where marginal cost is equal to marginal revenue |
| subsidy | government payment to encourage or protect a certain economic activity. Ex farmers |
| supply elasticity | responsiveness of quantity supplied to a change in price. |
| surplus | situation where quantity supplied is greater than quantity demanded at a given price. |
| shortage | situation where quantity supplied is less than quantity demanded at a given price |
| price floors | lowest legal price that can be charged for a product |
| market structure | market classification according to number and size of firms, type of product, and type of competition |
| price ceiling | maximum legal price that can be charged for a product |
