- The demand curve for a typical good has a(n)
negative slope because people will buy less at the price of the good falls.
negative slope because consumer incomes fall as the price of the good falls.
negative slope because people will buy less of it as prices rise.
inverse slope because as the price goes up, income falls.
The demand schedule for a good
- Indicates the quantity of the good that people will buy today.
indicates the quantities that suppliers should try to sell.
indicates the quantities that will be purchased at different prices.
is determined primarily by the cost of producing the good.
The opportunity cost of an action
- Can be determined by considering both the benefits that flow from as well as the monetary costs incurred because of the action.
can be determined by adding up the bills incurred because of the action.
can be objectively determined only by economists.
is a subjective valuation that can be determined only by the individual who chooses the action.
Scarcity implies that:
- There is less for sale than people want.
some consumers are too poor to afford the goods and services available
firms are not producing enough
it is impossible to completely fulfill the unlimited human desire for goods and services with the limited resources available.