Solutions for Chapter Module 5: Supply and Demand: Introduction and Demand

Full solutions for Krugman's Economics for AP® (High School) | 2nd Edition

ISBN: 9781464122187

Solutions for Chapter Module 5: Supply and Demand: Introduction and Demand

This expansive textbook survival guide covers the following chapters and their solutions. Chapter Module 5: Supply and Demand: Introduction and Demand includes 5 full step-by-step solutions. This textbook survival guide was created for the textbook: Krugman's Economics for AP® (High School), edition: 2. Krugman's Economics for AP® (High School) was written by and is associated to the ISBN: 9781464122187. Since 5 problems in chapter Module 5: Supply and Demand: Introduction and Demand have been answered, more than 3312 students have viewed full step-by-step solutions from this chapter.

Key Business Terms and definitions covered in this textbook
  • accounting profit

    total revenue minus total explicit cost

  • catch-up effect

    the property whereby countries that start off poor tend to grow more rapidly than countries that start off rich

  • collective bargaining

    the process by which unions and firms agree on the terms of employment

  • constant returns to scale

    The property whereby long-run average total cost stays the same as the quantity of output changes

  • currency

    the paper bills and coins in the hands of the public

  • demand curve

    a graph of the relationship between the price of a good and the quantity demanded

  • equilibrium price

    the price that balances quantity supplied and quantity demanded

  • implicit costs

    input costs that do not require an outlay of money by the firm

  • law of demand

    the claim that, other things being equal, the quantity demanded of a good falls when the price of the good rises

  • law of supply and demand

    the claim that the price of any good adjusts to bring the quantity supplied and the quantity demanded for that good into balance

  • money multiplier

    the amount of money the banking system generates with each dollar of reserves

  • national saving

    the total income in the economy that remains after paying for consumption and government purchases

  • natural monopoly

    a monopoly that arises because a single firm can supply a good or service to an entire market at a smaller cost than could two or more firms

  • net exports

    spending on domestically produced goods by foreigners (exports) minus spending on foreign goods by domestic residents (imports)

  • normative statements

    claims that attempt to prescribe how the world should be

  • Phillips curve

    a curve that shows the short-run trade-off between inflation and unemployment

  • price ceiling

    a legal maximum on the price at which a good can be sold

  • price floor

    a legal minimum on the price at which a good can be sold

  • union

    a worker association that bargains with employers over wages, benefits, and working conditions

  • utilitarianism

    the political philosophy according to which the government should choose policies to maximize the total utility of everyone in society

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