Chapter 5: Supply Nicnog B. Goodgrades

ChrisKrabb B. BettergradesMr. Treadway |Period 3

Overview  In this chapter we get into the idea of supply. We also learned how to draw supply curves.

Key Terms Supply - willingness and ability of sellers to produce and offer different quantities of a good at different prices during a specific time period.



Law of Supply - a law stating that as the price of a good increases, the quantity supplied of the good increases, and as the price of a good decreases, the quantity supplied of the good decreases



Direct Relationship - a relationship between two factors in which the factors move in the same direction



Quantity Supplied - the number of units of a good produced and offered for sale at a specific price 



Supply Schedule - a numerical chart illustrating the law of supply

 

Supply Curve - A graph that shows the amount of goods sellers are willing and able to sell at various prices.

Subsidy - A financial payment made by the government for certain actions.

Quota - A legal limit on the number of units of a foreign produced good that can enter a country.

Elasticity of Supply - The relationship between the percentage change in quantity supplied and the percentage change of the price.

Elastic Supply - The kind ofsupply that exists when the percentage change in quantity supplied is greater than the percentge change in price.

Inelastic Supply - The kind of supply that exists when the percentage change in quantity supplied is less than the percentage change in price.


Comprehension/Critical Thinking and Writing