Goal 8 Part 1 Notes
Chapter 21 and Chapter 23.1
Chapter 21 Section 1
Define the following terms:
1. demand
2. demand schedule
3. demand curve
4. law of demand
5. market demand
6. utility
7. marginal utility
8. diminishing marginal utility
Answer the following questions:
9.
If the price of a product goes up, what happens to the demand?
10. If the price of a product goes down, what happens to the demand?
11. Demand and price have what kind of relationship?
12. If you eat three piece of pizza, which one will you enjoy the most? Which one will you enjoy the least? What is this called?
13. Draw a demand curve for the demand schedule shown below:
Chapter 21, Section 2
Define the following terms:
1. substitute
2. complement
3. demand elasticity
4. List the six determinants of demand (besides price) and give an example for each.
a. __________________________________________
b. __________________________________________
c. __________________________________________
d. __________________________________________
e. __________________________________________
f. __________________________________________
6.
What is the difference between elastic demand and inelastic demand?
7.
Give two examples of products that have elastic demand.
8.
Give two examples of products that have inelastic demand.
Chapter 21, Section 3
Define the following terms.
1. supply
2. law of supply
3. supply schedule
4. supply curve
5. profit
6. market supply
7. productivity
8. technology
9. subsidy
10. supply elasticity
Answer the following questions:
11. If the price of a product decreases, what happens to the supply?
12. If the price of a product increases, what happens to the supply?
13. What is the relationship between price and supply?
14. What are businesses motivated to make?
15. List the eight determinants of supply (besides price) and give an example for each.
a. __________________________________________
b. __________________________________________
c. _________________________________________
d. __________________________________________
e. __________________________________________
f. __________________________________________
g. __________________________________________
h. __________________________________________
16. Give an example of supply elasticity.
17. Give an example of supply inelasticity.
18. Use the supply schedule below to graph a supply curve.
Chapter 21, Section 4
Define the following terms:
1. surplus
2. shortage
3. equilibrium price
4. price ceiling
5. price floor
6. minimum wage
Answer the following questions:
7. What happens when demand is greater than supply?
8. What happens when supply is greater than demand?
9. What is the equilibrium price?
10. If there is a surplus, what should a producer do to the prices?
11. If there is a shortage, what should a producer do to the prices?
Use the supply and demand schedules below to make a supply and demand curve on the graph.
Label the following:
Demand Curve
Supply Curve
Equilibrium Price
Show where a shortage takes place
Show where a surplus takes place
Chapter 23, Section 1
Define the following terms:
1. private good
2. public good
3. externality
4. monopoly
5. antitrust law
6. merger
7. natural monopoly
8. recall
Answer the following questions:
9. Give two examples of private goods.
10. Give two examples of public goods.
11. Give two examples of a positive externality.
12. Give two examples of a negative externality.
13. What is the role of government regarding competition?
14. What kind of laws does government pass to protect competition?
15. Give an example of a merger that the government has stopped.
16. Give an example of a natural monopoly.
17. How does government regulate advertising and product labels?
18. Give an example of a recall and explain why we have recalls.