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Unit 5
| Term | Definition |
|---|---|
| Buyer's Market | The best time for consumers to buy; characterized by large supply, small demand, and low prices. |
| Capital goods | Manufactured or constructed items that are used in the production of goods and services |
| consumer | Anyone who uses goods and services. |
| consumer goods | Tangible items produced for personal use. |
| consumption | The process or activity of using goods and services |
| demand | The quantity of a good or service that buyers are ready to buy at a given price at a particular time. |
| distribution | A marketing/business function that is responsible for moving, storing, locating, and/or transferring ownership of goods and services. |
| economic resources | The human and natural resources and capital goods used to produce goods and services. |
| economic want | Desires for items that can only be obtained by spending money |
| economics | The study of how to meet unlimited, competing wants with limited resources |
| economizing | The process of deciding which goods and services will be purchased or provided so that the most satisfaction can be obtained; deciding how scarce resources will be used. |
| elastic demand | A form of demand for products in which changes in price correspond to changes in demand. |
| elasticity | An indication of how changes in price will affect changes in the amounts demanded and supplied. |
| equilibrium price | The point at which the quantity of a good that buyers want to buy is equal to the quantity that sellers are willing to sell at a certain price. |
| Excess demand | The situation that exists when demand is greater than supply |
| excess supply | The situation that exists when supply is greater than demand. |
| exchange | The process of trading one good/service for another |
| Factors of production | Productive resources; human and natural resources and capital goods |
| Form utility | Usefulness created by altering or changing the form or shape of a good to make it more useful to the consumer. |
| goods | Tangible objects that can be manufactured or produced for resale |
| Human resources | People who work to produce goods and services. |
| Industrial goods | Tangible items that will be consumed by industrial users |
| Inelastic demand | A form of demand in which changes in price do not affect demand |
| Law of demand | Economic principle which states that the quantity of a good or service that people will buy varies inversely with the price of the good or service. |
| Law of supply | Economic principle which states that the quantity of a good or service that will be offered for sale varies in direct relation to its price. |
| Law of supply and demand | Economic principle which states that the supply of a good or service will increase when demand is great and decrease when demand is low |
| Market price | Actual price that prevails in a market at any particular moment |
| Natural resources | Any resource found in nature that is used to produce goods and services |
| Noneconomic want | Desires for things that can be obtained without spending money |
| Opportunity cost | The benefit that is lost when you decide to use scarce resources for one purpose rather than for another. |
| Place utility | Usefulness created by making sure that goods or services are available at the place where they are needed or wanted by consumers. |
| Possession utility | Usefulness created when ownership of a product is transferred from the seller to the user. |
| Price | The amount of money paid for a good, service, or resource |
| Producer | The people who make or provide goods and services. |
| Production | The economic process or activity of producing goods and services. |
| Rationing | A function of relative prices that determines who gets the goods and services produced; determining how scarce resources will be distribute. |
| Relative prices | One price compared to another; the ratio between two prices |
| Scarcity | A condition resulting from the gap between unlimited wants for goods and services and limited resources. |
| Seller’s market | The best time for producers to sell; characterized by large demand, small supply, and high prices |
| Services | Intangible activities that are performed by other people for money; productive acts that satisfy economic wants. |
| Substitution effect | A phenomenon that occurs when changes in relative prices cause buyers to replace the purchase of one product with another |
| Supply | The quantity of a good or service that sellers are able and willing to offer for sale at a specified price in a given time period |
| Time utility | Usefulness created when products are made available at the time they are needed or wanted by consumers or to complete specific business activities |
| Trade-off | Giving up all or a part of one thing in order to get something else. |
| Utility | Usefulness; capable of satisfying wants and needs. |
| Want | A desire for something that may or may not be required |
Created by:
lucas.t119
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