Ch. 3 Reading Guide: Due Tues 9/29

Note:  This assignment covers only the fist half of Ch. 3- pages 39-44.  You need only read to page 44 at this time. 


1.  In your own words, what is a market?  Excluding retail stores and the stock market, what are some markets you interact with daily? 


2.  What are the characteristics of an ideal, well functioning market?


3.  Define the Law of Demand.


4.  Define the Law of Diminishing Marginal Utility.


5.  Define income effect.


6.  Define substitution effect.


7.  Describe a time in your own life when your behavior closely followed the Law of Demand.


a.  Do the same for the law of the Law of Diminishing Marginal Utility.


b.  Now relate to a time when your consumer behavior rejected the conventions of the Law of Demand.