Micro unit 3 0.0 / 5 ? EconomicsDemand and SupplyA2/A-levelAQA Created by: Elle_BrookesCreated on: 26-04-18 16:34 Demand the quantity of goods/services consumers are willing and able to buy at a given price in a given time period 1 of 12 Effective Demand when a desire to buy a product is backed up by an ability to pay for it 2 of 12 Latent Demand when there is a willingness to buy a good/service but the consumer lacks the purchasing power to be able to afford the product 3 of 12 Composite Demand Demand for a good, which has more than one use. Increase in demand for on use = reduces supply of good for other use (e.g. wheat for biofuel or food) 4 of 12 Derived Demand when the demand for a product comes from the demand for another product (e.g. cars and steel) 5 of 12 Price Elasticity of Demand measure of the responsiveness of a change in demand to a change in price 6 of 12 Income Elasticity of Demand measure of the responsiveness of a change in demand to a change in income 7 of 12 Cross Elasticity of Demand measure of the responsiveness of change in demand for a good to a change in price of another 8 of 12 Supply the quantity of goods/services that producers are willing and able to supply at a given price in a given time period 9 of 12 joint supply when the production of one good results in the production of another (e.g. demand for beef increased supply of leather) 10 of 12 Price Elasticity of Supply measure of the responsiveness of a change in supply to a change in price 11 of 12 Price Functions - SIR Signalling (sändning message to market) Incentive (buyer/seller will change their habits) Rationing (buyer/seller restricts) 12 of 12
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