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ZERO BOND: Also termed a zero coupon bond, a bond that does not pay interest, in which the return is generated by the difference between the purchase price and the face value paid at maturity. Because they do not pay interest, zero bonds are sold at a discount. For example, a $10,000 zero bond that matures in one year, would generate a 10% return if it sold at a discount of $9,000.

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Lesson 9: Consumer Demand | Unit 5: Taking Stock Page: 20 of 22

Topic: Two Laws <=PAGE BACK | PAGE NEXT=>

  • One point of interest on the horizon is the law of demand.
  • Recall that...
  • The law of demand states that an inverse relation exists between demand price and the quantity demanded, ceteris paribus.
  • The portion of this definition that is most important to the theory of consumer demand is the demand price.
  • Definitionally speaking,
  • Demand price is the maximum price that buyers would be willing and able to pay for a given quantity of a good.
  • The law of diminishing marginal utility is the guiding principle of consumer demand theory.
  • It captures the relation between marginal utility and quantity.

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CONSERVATIVE

A political view that favors--(1) limited government intervention in the economy, (2) extensive reliance on markets, (3) strong national defense, (4) protection and promotion of existing cultural ideals and beliefs, and (5) economic rewards predominately based on productive efforts.

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Today, you are likely to spend a great deal of time searching for rummage sales looking to buy either a pair of red goulashes with shiny buckles or a handcrafted bird feeder. Be on the lookout for small children selling products door-to-door.
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Francis Bacon (1561-1626), a champion of the scientific method, died when he caught a severe cold while attempting to preserve a chicken by filling it with snow.
"It is not because things are difficult that we do not dare; it is because we do not dare that they are difficult. "

-- Seneca, statesman, dramatist, philosopher

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