| A | B |
|---|
| Law of Demand | States there is an inverse relationship between the price of a good or service and the quantity buyer’s purchase |
| Revenue | price x quantity = |
| Demand | The desire, willingness and ability to buy something |
| Inelastic Demand | A change in price will cause a relatively smaller change in demand |
| Unitary Elastic Demand | The percentage change in quantity demanded is equal to the percentage change in price |
| Surplus | Quantity supplied is greater than the quantity demanded |
| Equilibrium | The price at which quantity demanded is equal to quantity supplied |
| Substitute Good | Goods that can be used in place of one another |
| Inferior Good | Any good that people will buy less of as their income rises |
| Quantity Demanded | The amount of goods and services purchased at any given price |
| Price Ceiling | Legally established highest price a seller can charge for a good or service |
| Price Floor | Legally established lowest price a seller can charge for a good or service |
| Normal Good | An increase in income typically causes buyers to purchase more |
| Complementary Goods | Goods that are used together, and when the price of one rises, it will affect demand for the other |
| Law of Supply | Direct relationship between the price of the good and the quantity sellers offer for sale |
| Shortage | Quantity supplied is less than the quantity demanded |
| Supply | The amount of goods and services supplied at any given price |
| Elastic | When a change in price causes a relatively larger change in demand |
| Quantity Supplied | How much stuff is available |
| Bartering | An exchange between two parties using goods and services for payment instead of currency |
