1.3.1 demand and supply

• effective demand 


  the willingness and ability to pay the market price
• market demand


  The quantity of a good/service that a particular consumer or individual is willing and able to buy at different market prices.
• Condition of demand 


  A determinant of demand, other than the good’s own price, that fixes the position of the demand curve.
• Normal good 


  A good for which demand increases as income rises and demand decreases as income falls.
• Inferior good


  A good for which demand decreases an incomes rises and demand increases as income falls.​
• Substitute goods 


  Alternative goods that could be used for the same purpose e.g. Cadbury’s or Galaxy chocolate or Audi vs BMQ
• Complementary goods 


  When two goods experience joint demand and are used together.
• Increase in demand 


  A upward/rightward shift of the demand curve​
• Decrease in demand 


  A downward/leftward shift of the demand curve.
• Ceteris Paribus 


  All other factors remaining equal.
• Utility 


  The satisfaction we get from consuming a good.
• Marginal utility 


  The change in satisfaction from consuming an extra unit.