Substitute goods – goods that
you might purchase instead of a particular good. For example, different types of bread are
substitutes for each other.
Supply
Function – the mathematical function that relates price and quantity supplied for goods or services. The supply function tells how many units of a good that producers are willing to
produce and sell at a given price.
Supply
Curve - the
graphical representation of the supply function. Because producers would like to sell more at
higher prices, the supply function slopes upward.
Total
economic value – the sum of all types of use and non-use values for a good or service.
Use
value – value derived from actual use of a good or service. Uses may include
indirect uses. For example, enjoying a television show
about whales provides an
indirect use value for the whales.
Variable costs – production
costs that change when the level of production changes, so that when more is produced
the costs increase; as opposed to fixed
costs.
Willingness to Pay – the amount—measured in goods, services, or dollars—that a person
is willing to give up to get a particular good or service.