1. Prices and Decision Making
Chapter 6 Review
Prices and Decision Making

2. Vocabulary Price ceiling Ration coupon Market equilibrium
Equilibrium price
Target price

3. Vocabulary
Economic model
Price
Deficiency payment
Surplus
Shortage

4. Concepts The economics of prices What do prices represent?
How are they derived?
Why do they perform effectively and efficiently?

5. Concepts Surpluses/Shortages Determining them. What are they?
How does the market correct these situations?
Graphically, how are they represented?

6. Concepts Rationing e-commerce Advantages/Disadvantages
How do they work?
e-commerce
What is it?
Advantages/disadvantages

7. Concepts What do “price supports” do? Competitive Markets
How do they function?
Competitive Markets
How do they work?
What part do they play in the economy?

8. Concepts Price Floors Advantages/Disadvantages How do they work?
Examples

9. Concepts Price Ceilings Equilibrium Advantages/Disadvantages
How do they work?
Examples
Equilibrium
What is it?
Determining graphically

10. Essays/Short Answers
Be able to identify/determine the relationship between demand elasticity and price changes.

11. Essays/Short Answers
Using supply and demand concepts, explain what is meant by a seller’s market. Also, be able to determine the outcome of a surplus/shortage situation.

12. Essays/Short Answers
Identify and explain what happens when governments set price ceilings and price floors.

13. Essays/Short Answers
Be able to identify equilibrium from a supply/demand schedule. Also, be able to determine what happens to supply and demand when price changes.

14. Review Questions
Page 164 – 165
10,14,16,21