equilibrium
point at which quantity supplied equals quantity demanded
price ceiling
a maximum price that can be legally charged for a good or service
shortage
occurs when the quantity demanded is greater than the quantity supplied
price floor
a minimum price that can be legally charged for a good or service
law of supply
quantity supplied varies directly with price
law of demand
quantity demanded varies indirectly with price
surplus
occurs when the quantity supplied is more than the quantity demanded
rationing
a system of allocating scarce goods and services using criteria other than price
black market
a market in which goods are sold illegally
income
non-price determinant for demand, amount of money a person earns will cause the demand curve to shift
related goods
non-price determinant for demand, complements and substitutes will cause the demand curve to shift
tastes and preferences
non-price determinant for demand; fads, fashions, news reports will cause the demand curve to shift
consumer future expectations
non-price determinant for demand; changes in the price of the product in the future will cause the demand curve to shift now
population/demographics
non-price determinant for demand; the amount of people purchasing the product will cause the demand curve to shift
technology
non-price determinant for supply; method of production or the way a product is made will cause the supply curve to shift
number of sellers
non-price determinant for supply; the amount of people making the product will cause the supply curve to shift
producer future expectations
non-price determinant for supply; changes in the price of the product in the future will cause the supply curve to shift now
taxes and subsidies
non-price determinant for supply; money that is paid to the government or the government gives a businesses will cause the supply curve to shift
government regulations
non-price determinant for supply; the amount of rules placed on a business will cause the supply curve to shift
input costs
non-price determinant for supply; the cost of materials, workers, etc will cause the supply curve to shift