| A | B |
|---|
| demand | want and ability to purchase |
| demand schedule | listing showing the quantity demanded at all possible prices |
| law of demand | more will be demanded at lower prices and less at higher prices |
| demand curve | graph showing the quantity demanded at each price |
| change in quantity demanded | consumers demand different amaounts at every price causing the demand curve to shift to the left or right |
| determinent | change |
| substitutes | competing products which can be used in place of another |
| complements | products that increase the value of other products |
| diminishing marginal utility | decreasing satisfaction or usefulness |
| marginal utility | satisfaction or usefullness attained from acquiring one more unit of a product |
| elastic | price causes a great change in the demand for a product |
| inelastic | price does not cause a great change in the demand for a product |
| supply | want and ability to produce |
| law of supply | more will be offered for sale at higher prices and less at lower prices |
| supply schedule | chart showing the quantities supplied at different prices |
| supply curve | graphical representation of quantities produced at every price |
| quantity supplied | amount offered for sale at a given price |
| change in quantity supplied | change in the amount offered for sale in responce to a price change |
| subsidy | government payment to protect a certain economic activity |
| surplus | quantity supplied is greater than quantity demanded |
| shortage | quantity supplied is less than quanity demanded |
| fixed cost | cost of production that does not change when output changes |
| variable cost | cost of production that changes when output changes |
| total costs | Fixed costs + variable costs |
| total revenue | price of goods sold times quantity sold (total receipts) |
| break-even point | total costs = total revenues |
| profits | revenues made after all costs have been paid (must be a positive number) |
| equilibrium price | quantity supplied = quantity demanded |
| maximized profit | the difference between total revenue and total costs is greatest |
| payroll | who is working for you |
| inventory | items you have for your business |
| revenue | money |
| profits | money made after all costs have been paid |
| tradeoff | alternatives that must be given up when one is chosen rather than another |
| opportunity cost | the next best alternative |
| scarcity | scarce resources and unlimited wants |
| market economy | economic system where supply, demand and the price system help people make decisions and allocate resources |
