ECON 401 Chapter Notes - Chapter 2: Budget Constraint, Substitute Good, Opportunity Cost

1.

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The satisfaction or benefit that consumers receive from consuming goods or services.

2.

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A particular combination of specific quantities of goods or services

3.

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Consumers can rank all conceivable bundles of goods or services

4.

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If A is preferred to B, and B is preferred to C, then A is always preferred to C.

5.

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Equation showing a consumer’s perception of the total utility forthcoming from consuming each bundle of goods and services.

6.

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A set of consumption bundles each and every one of which provides a consumer with exactly the same level of total utility.

7.

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The number of units of Y that must be given up for total utility to remain the same when one more unit of X is consumed.

8.

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The addition to total utility attributable to consuming one more unit of a good, holding the consumption of all other goods constant.

9.

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The line showing all bundles of goods that can be purchased at given prices if the entire income is spent.

10.

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The change in the consumption of a good that would result if the consumer remained on the original indifference curve after the price of the good changes.

11.

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The change in consumption of goods results strictly from the change in purchasing power after the price of a good changes.

12.

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The sum of the substitution and income effects.

13.

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A good for which quantity demanded varies directly with price, causing an upward sloping demand curve.

14.

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A list of prices and the corresponding quantity consumers are willing and able to purchase at each price.