Demand and Marginal Utility

The more of a product that you consume, the less satisfaction the consumer enjoys..

• income effect

• diminishing marginal utility

• demand elasticity

• purchasing power

As prices for a product decrease, demand for a product should increase..

• diminishing marginal utility

• elasticity

• income effect

• law of demand

States that people buy a different quantity of a product if that product’s price changes, appearing as a movement along the demand curve.

• Change in demand

• Change in supply

• Change in quantity demanded

• Change in quantity supplied

VOCABULARY DEFINITION: additional satisfaction or usefulness a consumer gets from having one more unit of a product

• market demand curve

• marginal utility

• diminishing marginal utility

• utility

decrease in satisfaction or usefulness from having one more unit of the same product

• market demand curve

• marginal utility

• diminishing marginal utility

• utility

Section Main Idea: What is demand?

• When you want something.

• The desire, ability, and willingness to buy something.

• When the price is high, you want more.

rule stating that consumers will buy more of a product at lower prices and less at higher prices

• demand curve

• demand schedule

• demand

• law of demand

VOCABULARY DEFINITION:a curve that shows how much of a product all consumers will buy at all possible prices

• market demand curve

• marginal utility

• diminishing marginal utility

• utility

The concept that explains why consumers experience less satisfaction from consuming additional units of the same product is known as?

• A) Law of Demand

• B) Diminishing Marginal Utility

• C) Income Effect

• D) Elasticity

What happens to the demand for a product when its price decreases, according to economic theory?

• A) Demand decreases

• B) Demand remains constant

• C) Demand increases

• D) Demand becomes elastic