IGCSE Economics Chapters 1-5 Key Terms 0.0 / 5 ? EconomicsEconomicsIGCSEEdexcel Created by: supitsjoanCreated on: 15-03-14 11:23 Demand the amount of a good that will be bought at give prices over a period of time 1 of 19 Exporters firms that sell overseas 2 of 19 Market a set of arrangements allowing buyers and sellers to communicate and exchange goods and services 3 of 19 Market system / Price mechanism the automatic determination of prices and the allocation of resources by the operation of markets in the economy 4 of 19 Price the amount of money that goods are exchanged for in a transaction 5 of 19 Supply the amount of a good that sellers are prepared to sell at given prices over a period of time 6 of 19 Demand curve a line drawn on a graph which shows how much of a good will be bought at different prices 7 of 19 Effective demand the amount of a good people are willing to buy at given prices over a given period of time backed by the ability to pay 8 of 19 Inverse relationship (between price and quantity demanded) when price goes up the quantity demanded falls and when the price goes down the quantity demanded rises 9 of 19 Complementary goods goods purchased together because they are consumed together 10 of 19 Inferior good a good for which demand will fall if income rises or rise if income falls 11 of 19 Normal good a good for which demand will rise if income rises or fall if income falls 12 of 19 Shift in the demand curve a movement to the left or the right of the entire demand curve when there is a change in any factor affecting demand except the price 13 of 19 Substitute goods goods bought as an alternative to another but perform the same function 14 of 19 Supply curve a line drawn on a graph which shows how much of a good sellers are willing to supply at different prices 15 of 19 Advalorem tax a tax levied as a percentage of the price of a good 16 of 19 Indirect taxes taxes imposed byt he government on spending 17 of 19 Specific tax a lump sum tax on the amount sold, per unit for example 18 of 19 Subsidy a grant given to producers, usually to encourage production of a certain good 19 of 19
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