inverse relationship between price and quantity demanded, the lower the prices the more products are demanded by customers
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Demand
amount of a product that customers will want and be able to buy at a range of different prices
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Market demand
total of all individual demands for a product
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Demand curve
graphical representation of the relationship between quantity demanded and price for a product or service
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Supply
quantity of a good/service that a producer is willing and able to supply onto the market at a given price in a given time period
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Equilibrium
found where supply and demand are equal, where both sellers and buyers are happy with the price and quantity
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Basic law of supply
as the price of a product rises, so businesses expand supply to the market
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Market supply
total output of all individual suppliers to a particular good/service
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Supply curve
relationship between price and quantity of a product that producers want to create and sell, shows total amount supplied to market by all producers at a range of different pricesPri
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Elasticity
measures the responsiveness of demand to a change in a relevant variable such as price
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Price elasticity of demand
measures the extent to which the quantity of a product demanded is affected by a change in price
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PED equation
% change in quantity demanded / % change in price
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% change in quantity demanded
difference in original units to new units / original units x100
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% change in price
difference between original price and new price / original price x100
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Revenue
price x quantity
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Other cards in this set
Card 2
Front
amount of a product that customers will want and be able to buy at a range of different prices
Back
Demand
Card 3
Front
total of all individual demands for a product
Back
Card 4
Front
graphical representation of the relationship between quantity demanded and price for a product or service
Back
Card 5
Front
quantity of a good/service that a producer is willing and able to supply onto the market at a given price in a given time period
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