Price ceiling
A legally determined maximum price that sallers may change
Market
A group of buyers and sellers of a good or service and the institution or arrangement by which they come together to trade.
Average variable Cost
Variable cost divided by the quantity of units produced.
Consumer Surplus
The difference between the highest price a consumer is willing to pay and the price the consumer actually pays.
Economic profit
A firm”s revenues minus all of its costs, implicit and explicit
Elasticity
A measure of how much one economic variable responds to changes in another economic variable.
Indifference curve
A curve that shows the combinations of consumption bundles that give the consumer the same utility.
Inferior good
A good for which that demand increases as income falls, and decreases as income rises.
Law of diminishing returns
The principle that, at some point, adding more of a variable input, such as labor, to the same amount of a fixed input, Such as capital, will call the marginal product of the variable input to decline.
Marginal rate of substitution MRS(MRTS)
The slope of an indifference curve, represents the rate at which a consumer would be willing to trade off on good for another.
Monopolistic competition
A market structure in which barriers to entry are low and many firms complete by selling similar ,but not identical products.
Monopoly
The only seller of a good or service that does not have a close substitute.
Oligopoly
A market structure in which a small number of interdependent firms compete
Opportunity cost
The highest valued alternative that must be given up to engage in an activity.
Price discrimination
Changing different prices to different customers for the same product when the price differences are not due to differences in cost.
A legally determined maximum price that sallers may change
Market
A group of buyers and sellers of a good or service and the institution or arrangement by which they come together to trade.
Average variable Cost
Variable cost divided by the quantity of units produced.
Consumer Surplus
The difference between the highest price a consumer is willing to pay and the price the consumer actually pays.
Economic profit
A firm”s revenues minus all of its costs, implicit and explicit
Elasticity
A measure of how much one economic variable responds to changes in another economic variable.
Indifference curve
A curve that shows the combinations of consumption bundles that give the consumer the same utility.
Inferior good
A good for which that demand increases as income falls, and decreases as income rises.
Law of diminishing returns
The principle that, at some point, adding more of a variable input, such as labor, to the same amount of a fixed input, Such as capital, will call the marginal product of the variable input to decline.
Marginal rate of substitution MRS(MRTS)
The slope of an indifference curve, represents the rate at which a consumer would be willing to trade off on good for another.
Monopolistic competition
A market structure in which barriers to entry are low and many firms complete by selling similar ,but not identical products.
Monopoly
The only seller of a good or service that does not have a close substitute.
Oligopoly
A market structure in which a small number of interdependent firms compete
Opportunity cost
The highest valued alternative that must be given up to engage in an activity.
Price discrimination
Changing different prices to different customers for the same product when the price differences are not due to differences in cost.
