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HORIZONTAL AXIS: In a graph, this is one of two lines that intersect at a right angle at their origins. This is the "X-axis" that runs from right and left. In most analyses, the variable measured on the X-axis is consider to be the independent variable.
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Lesson 5: Market Demand | Unit 4: Determinants
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Page: 18 of 20
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- Why relaxing the ceteris paribus assumption enables further analysis of demand and markets.
- How the changes in the demand determinants cause rightward or leftward shifts in the demand curve.
- The five basic demand determinants: income, preferences, prices of other goods, buyers' expectations, and number of buyers.
- How income affects the demand for normal goods differently than inferior goods.
- How a change in the price of a substitute goods affects demand differently than a change in the price of a complement good.
- Most important of all, the difference between a change in demand, caused by a change in a demand determinant, and a change in quantity demanded, caused by a change in price.
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PERFECTLY INELASTIC An elasticity alternative in which changes in one variable (usually price) do NOT cause any changes in another variable (usually quantity). Quantity is totally, completely unresponsive to price. Quantity just does not change, regardless of changes in price. This characterization of elasticity is most important for the price elasticity of demand and the price elasticity of supply. Perfectly inelastic is one of five elasticity alternatives. The other four are perfectly elastic, relatively elastic, relatively inelastic, and unit elastic.
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The average bank teller loses about $250 every year.
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"We succeed in enterprises (that) demand the positive qualities we possess, but we excel in those (that) can also make use of our defects." -- Alexis de Tocqueville, Statesman
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SMSA
Standard Metropolitan Statistical Area
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