Determination of prices in a competitive market quiz

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  • Created by: Joe Hicks
  • Created on: 15-06-15 16:47
What is supply?
The quantity that a producer is willing and able to produce at a given price at a given time period/
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What relationship exists between price and supply?
Positive correlation
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What are two factors that cause the supply curve to shift?
Productivity. Indirect forces (taxes), number of firms entering market, technology, subsidies, weather, costs of production
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What is effective demand?
When the consumer must be able to buy the good or service
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What are two factors that causes demand curve to shift?
Substitutes, population, advertising, income, fashion, interest rates, complimentary goods.
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What is an inferior good?
Goods which demand falls when income rises. E.g. Bus journeys. As people's incomes rise, they can afford to buy their own vehicles and the demand for bus journeys falls.
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Card 2

Front

What relationship exists between price and supply?

Back

Positive correlation

Card 3

Front

What are two factors that cause the supply curve to shift?

Back

Preview of the front of card 3

Card 4

Front

What is effective demand?

Back

Preview of the front of card 4

Card 5

Front

What are two factors that causes demand curve to shift?

Back

Preview of the front of card 5
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