Term
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Definition
| assessment of expected, objective outcomes |
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Term
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Definition
| nonscientific value judgment |
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Term
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Definition
| the interplay of all potential buyers and sellers of a particular commodity or service |
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Term
| nominal (absoulute) price |
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Definition
| not adjusted for the changing value of money |
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Term
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Definition
| the nominal price adjusted for the changing value of money |
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Term
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Definition
| the behavior of market participants interested in fulfilling their own, personal goals |
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Term
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Definition
| the behavior of market participants based on a carefuul, deliberative process that weighs expected benefits and costs |
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Term
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Definition
| insufficient time, money, or other resources for individuals to satisfy all their desires |
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Term
| basic assumptions about Market Participants |
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Definition
| goal-orientated behavior, rational behavior, & scarce resources |
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Term
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Definition
| money used in the puruit of a goal that could otherwise have been spent on an alternative objective |
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Term
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Definition
| costs associated witht the individual's use of his/her time and other resources in the puruit of a particular activity versus alternatives |
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Term
| opportunity (economic) cost |
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Definition
| the sum of explicit and implicit costs |
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Term
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Definition
| costs reported in companies' net income statements generated by accountants |
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Term
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Definition
| costs that have already been incurred and are beyond recovery |
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Term
| production possibility frontier (PPF) |
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Definition
| a depiction of all the different combinations of goods that a rational actor with certain personal goals can attain with a fixed amount of resources |
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Term
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Definition
| the lower the price of a good, the larger the quantity consumers wish to purchase |
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Term
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Definition
| increase in income leads to greater consumption |
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Term
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Definition
| consumption falls when income rises |
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Term
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Definition
| two goods that tend to be consumed together, so consumption of both tends to rise or flal simultaneously |
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Term
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Definition
| goodsd that can replace one another in consumption |
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Term
| movement along the demand curve |
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Definition
| change in quantity demanded in response to a change in price, other factors holding constant |
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Term
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Definition
| occurs with a change in factors, besides price that affects the quantity demanded at each possible price |
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Term
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Definition
| higher the price of a good, the larger the quantity frims what to produce |
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Term
| movement along supply curve |
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Definition
| change in quantity supplied that occurs in response to a change in the good's selling price, holding other factors constant |
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Term
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Definition
| occurs when the other factors, besides price, that affect output change |
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Term
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Definition
| quantity demanded equals quantity supplied at the prevailing price |
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Term
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Definition
| quantity demanded and the quantity supplied are not in balance |
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Term
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Definition
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Term
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Definition
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Term
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Definition
| legislated maximum price for a good |
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Term
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Definition
| legislated minimum price for a good |
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Term
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Definition
| measures of the magnitude of the responsiveness of any variable to a change in particular determinants |
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Term
| price elasticity of a demand |
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Definition
| measure of how sensitive qualtity demanded is to a change in a product's price |
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Term
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Definition
| price elasticity of demand exceeds 1.0 or unity |
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Term
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Definition
| price elasticity of demand is less tha 10.0 or unity |
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Term
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Definition
| price elasticity of demand equals 1.0 or unity |
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Term
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Definition
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Term
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Definition
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Term
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Definition
| commodities of which less is preferred to more over all possible ranges of consumption |
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Term
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Definition
| commodities of which more is better than less |
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Term
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Definition
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Term
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Definition
| a plot of all the market baskets the consumer views as being equally satisfactory |
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Term
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Definition
| a set of indifference curves that shows the consumer's entire preference ranking |
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Term
| marginal rate of substitution (MRS) |
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Definition
| a measure of the consumer's willingness to trade one good for another |
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Term
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Definition
| a consumer's willingness to give up less and less of some other good to obtain still more of the first good |
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Term
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Definition
| a case in which the consumer doesn't care one way or another about a particular good |
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Term
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Definition
| the case where a a consumer is willing to substitute on good for another at some constant rate and remain equally well off |
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Term
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Definition
| goods that must be consumed in a precise combination in order to provide a consumer a given level of satisfaction |
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Term
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Definition
| the way in which a consumer's income and the prices that must be paid for various goods limit choices |
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Term
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Definition
| a line that shows the combinations of goods that can be purchased at the specified prices and assuming that all of the consumer's income is expended |
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Term
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Definition
| income changes and price changes |
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Term
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Definition
| the value the consumer derives from consuming one more unit of a good |
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Term
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Definition
| the cost of consuming one more unit of a good |
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Term
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Definition
| a situation in which a particular good is not consumed at all by an individual consumer because the value of the first unit of the good is less than thecost |
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Term
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Definition
| a number of goods treated as a group |
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