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REAL WAGE: The inflation-adjusted purchasing power of the nominal wage. The real wage is commonly derived by dividing the nominal wage by the price level, indicates the physical quantities of goods and service that can be purchased with the nominal wage.
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Lesson 5: Market Demand | Unit 2: Law of Demand
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Page: 8 of 20
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- The law of demand, which is a fundamental economic principle stating that demand price and quantity demanded are inversely related, ceteris paribus.
- Ceteris paribus, a Latin term meaning that other things remain unchanged. It is used to control for factors other than price, that affect demand.
- Why the law of demand works because of the income and substitution effects.
- The income effect, which exists because price changes affect the purchasing power of buyers' given incomes.
- The substitution effect, which exists because price changes make other goods relatively more or less expensive.
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AGGREGATE SUPPLY INCREASE, LONG-RUN AGGREGATE MARKET A shock to the long-run aggregate market caused by an increase in aggregate supply, resulting in and illustrated by a rightward shift of the long-run aggregate supply curve. An increase in aggregate supply in the long-run aggregate market results in a decrease in the price level and an increase in real production. The level of real production resulting from the shock is a greater level of full-employment real production.
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WHITE GULLIBON
[What's This?]
Today, you are likely to spend a great deal of time at an auction trying to buy either a small, foam rubber football or an instructional DVD on learning to the play the oboe. Be on the lookout for the last item on a shelf.
Your Complete Scope
This isn't me! What am I?
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There were no banks in colonial America before the U.S. Revolutionary War. Anyone seeking a loan did so from another individual.
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"If anything terrifies me, I must try to conquer it. " -- Francis Charles Chichester, yachtsman, aviator
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LCH
Life Cycle Hypothesis
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