01:220:102 Chapter Notes - Chapter 3: Demand Curve, Inferior Good, Normal Good
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01:220:102 Full Course Notes
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Competitive market- market in which there are many buyers and sellers of the same good or service, none of whom can influence the price at which the good or service is sold. Supply and demand model- model of how a competitive market works. Demand schedule- shows how much of a good or service consumers will want to buy at different prices. Quantity demanded- actual amount of a good or service consumers are willing to buy at some specific price. Demand curve- graphical representation of the demand schedule: shows relationship between quantity demanded and price. Law of demand- higher price for a good or service, other things equal, leads people to demand a smaller quantity of that good or service. Shift of the demand curve- change in the quantity demanded at any given price, represented by the change of the original demand curve to a new position, denoted by a new demand curve.