# Econ Unit 2 Test Review pt. 1

 The flashcards below were created by user gerardcb on FreezingBlue Flashcards. Demand Desire, ability, and willingless to buy product Microeconomics Deals with behavior and decision making in SMALL UNITS (firms, individuals) Demand Schedule List that shows various quantities demanded of a particular product at all times Demand Curve Graph showing quantity demanded at each and every price Law of Demand states quantity demanded of a good/service varies inversely with its price Market Demand Curve Shows quantities demanded by everyone who is interested in purchasing product. Marginal Utility Extra usefulness or satisfaction a person gets from using one more unit of a product Diminishing Marginal Utility Extra satisfaction we get from using an additional quantities of a product begins to diminish Change in quantity demanded Movement alond demand curve that shows a chance in quantity of product purchased in response to change in price Substitutes Used in place of other products Complements Related good are complements. More use of other goods, equal more use of products Change in Demand People have changed their minds about the amount they would buy at every price. (Right to left on demand curve) Demand elasticity Extent to which a change in price causes a change in the quantity demanded Elastic Given change in price sauses larger change in quantity demanded Elasticity Measure of responsiveness that tells us how a dependant variable(quantity) responds to change in an independent variable(price) Unit Elastic Given change in price causes a proportional chance in quantity demanded Quantity Supplied Amount offered for sale at a given price Inelastic Given change in price causes a smaller change in quantity demanded Subsidy Government payment to an indivudual, business, or other group to encourage or protect a certain type of economic activity Supply Elasticity How change in quantity supplied responds to chance in price Change in Supply Change in quantity supplied. (Increase in supply = right) (Decrease in supply = left) Long run Period of production long enough for producers to adjust the quantities of all their resources including capital Diminishing returns Stage where output increases at diminishing rate as more unites of a variable input are added Theory of production Relationship between factors of production and output of goods and services Short run Period of production that allows producers to change only the amount of labor Authorgerardcb ID111932 Card SetEcon Unit 2 Test Review pt. 1 Descriptionecon unit 2 pt. 1 Updated2011-10-25T04:38:13Z Show Answers