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Unformatted text preview: Inferior Good - A good for which quantity demanded decreases with increases in income. Marginal Utility - Additional utility derived from each additional unit of goods acquired. Market - A large group of buyers and sellers who are buying and selling the same good or service. Market Economy - An economy in which the prices and distribution of goods and services are determined by the interaction of large numbers of buyers and sellers who have no significant individual impact on prices or quantities. Market-clearing Price - The price of a good or service at which quantity supplied is equal to quantity demanded. Also called the equilibrium price. Microeconomics - Subfield of economics which studies how households and firms behave and interact in the market. Normal Good - A normal good is a good for which an increase in income causes an increase in demand, and vice versa. Optimization - To maximize utility by making the most effective use of available resources, whether they be money,...
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This note was uploaded on 12/13/2011 for the course ECO 1320 taught by Professor Staff during the Fall '11 term at Texas State.
- Fall '11