chapter 3 notes

chapter 3 notes - Economics 9/4/06 Chapter 3 Vocabulary...

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Economics 9/4/06 Chapter 3 Vocabulary Market – an institution or mechanism that brings together buyers and sellers of particular goods, services or resources Demand – a schedule or a curve that shows the various amounts of a product that consumers are willing and able to purchase at each of a series of possible prices during a specified period of time Demand Schedule – table of information expressing demand and price Law of Demand – the negative or inverse relationship between price and quantity demanded Income Effect – Indicates that a lower price increases the purchasing power of a buyer’s money income Substitution Effect – At lower price buyers have the incentive to substitute what is now a less expensive product for similar products that are now relatively more expensive Demand Curve – A graph that indicates the inverse relationship between price and quantity demanded for any product Determinants of Demand – Factors affecting products purchased Normal Goods – Products whose demand varies DIRECTLY with the money income
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chapter 3 notes - Economics 9/4/06 Chapter 3 Vocabulary...

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