Microeconomics test

the higher the price, the more firms are willing to supply

amount people are willing to buy goes down as price goes up

you have to want it, be willing to pay, and able to pay

table that shows the amount consumers are willing to buy at different prices

table that shows amount firms are willing to sell at different prices

the amount of the good that cosumers are willing to buy

amount of the good that firms are willing to sell

• graph of demand schedule 
• negative slope

• graph of the supply schedule 
• positive slope

• technology
• price of goods used in production
• number firms in market 
• expectations of future prices
• gov. regulations, subsidies, and taxes

• changes in preference
• consumer income
• changes in population
• expectations of future prices/ income
• prices of substitute and completment goods and inferior goods

• quantity supplied equals quantity demanded
• comsumers are willing to buy and producers are willing to sell

supply and demand curves intersect

it has reached equillribrum

a small change in price changes quantity demanded

change in price does not affect demand

sole proprietorship, partnership, corporation

• easy to get in and out of business
• control over all profits and the way your business is run 
• pride of ownership
• lower taxes

• unlimited liability
• difficult to raise captial
• responsible for all losses
• poor management skills
• limited life

• easier to raise financial capital 
• partners combine their abilities
• personal satisfaction
• lower taxes

• unlimited liability 
• share profits
• dissagreements between partners 
• possible instability after death of partnet

• limited liability 
• greater financial capital 
• unlimited life
• specialized management

• incresed taxes
• difficult to start
• very large
• increased gov control

• perfect comp. 
• monopolistic comp
• oligopoly
• monopoly

• many firms
• identical products 
• no control over price
• easy to enter industry 
• no non-price comp.

• Many firms
• similar but not identical products
• some control over price
• fairly easy to enter market
• lots of non-price comp.

• few large firms
• similar or different prodcuts
• control over price
• lots if products are different
• fairily difficult to enter market

• one firm
• different products
• control over price
• farily difficult to enter market 
• non-price comp. may very well exist

place where people buy and sell

merger between companies of different industries

merger between companies of the same industry

flow of money

• gov
• factor market and product market

sells goods and services

sells factors of production

the most primative form of trade

it is hard to find a double coincidence of wants

• durable
• portable 
• stable

• standard of value
• medium of exchange
• way to store value

sole proprietorship

money is a measure of quality

monopoly in an industry in which it is most efficient (involving the lowest long-run average cost) for production to be concentrated in a single firm.

• prevent prices from falling
• creates surpluses

• prevents prices of rising 
• creates shortages

creates shortages or surpluses

• exit of firms 
• when less is supplied

when demand falls

• new firms
• technology 
• more is supplied at every price

more is demanded