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Flashcards in Demand + Supply Deck (14)
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1

latent demand

unable to actually buy (no money)

2

effective demand

able to actually buy

3

demand

the quantity of a good or service a consumer is willing and able to purchase at a given price

4

market demand

the sum of the individual demand

5

revenue

the income a business receives from selling its products

6

supply

the quantity of a good/service that producers are willing and able to sell at each different price level

7

consumer surplus

the difference between what consumers are willing to pay for a good/service and the price they actually pay

8

producer surplus

the difference between what firms are willing to sell a good/service for and the price they are actually paid

9

complements (joint demand)

goods that are consumed together

10

substitudes

products that can replace each other

11

composite demand

goods have more than one use

12

derived demand

demand for a FOP is derived from the demand for the product it produces

13

joint supply

two or more goods are produced

14

Policy to increase demand for business

1. reducing the price of the good
2. advertising to increase demand
3. switch production to inferior goods