Consumers in Markets Flashcards

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Who is a consumer in economics?

Someone who buys goods or services to satisfy wants and needs.

The amount buyers are willing and able to buy at different prices in a given time.

When price rises, quantity demanded falls. When price falls, quantity demanded rises, other things the same.

A change in the good's own price. It changes the quantity demanded, not the curve itself.

Changes in income, tastes, population, advertising, or prices of related goods shift the whole curve.

A good used instead of another. If the price of one goes up, demand for its substitute goes up (e.g. tea and coffee).

A good used with another. If the price of one goes up, demand for its complement goes down (e.g. printers and ink).

For normal goods, higher income means more demand. For inferior goods, higher income means less demand (e.g. bus travel may be inferior).

A measure of how much quantity demanded changes when the price changes.

Elastic if a small price change causes a big change in demand. Inelastic if demand changes little when price changes.

The total demand from all consumers, found by adding up each buyer's demand at each price.

The limit set by income and prices. Consumers must choose what they can afford.