Econ 4.2 3.0 / 5 based on 1 rating ? EconomicsIGCSENone Created by: Amy HaoCreated on: 10-12-12 05:01 Define allocation of resources Because of scarcity, not every person’s wants can be satisfied so it must be decided whose wants to satisfy 1 of 11 Describe shape of demand curve Contraction-The higher the price of a good, the less people will demand that good 2 of 11 6 factors that affect demand -price-consumer taste-income available to consumer-prices of substitutes-interest rates-consumer population 3 of 11 Describe shape of supply curve Extension-The higher the price, the higher the quantity supplied 4 of 11 5 factors that affect supply -cost of FOP-prices of other goods/services-technology advance-business expectations 5 of 11 Define equilibrium price the point where the supply and demand curve crosses 6 of 11 explain excess supply above equilibrium price, allocative inefficiency 7 of 11 explain excess demand Because the price is so low, too many consumers want the good while producers are not making enough of it 8 of 11 Define PEd responsiveness of demand to a change in price 9 of 11 how is it shown is shown by the degree of the demand curve 10 of 11 Number for elastic demand Over 1 11 of 11
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