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Econ Chapter 7

The flashcards below were created by user misol on FreezingBlue Flashcards.

  1. Welfare Economics
    The study of how allocation of resources affects economic well being of the economy
  2. Consumers willingness to pay directly measures
    • How much a buyer values a good
  3. Consumer Surplus
    buyer's willingness to pay - actual amount paid by buyer
  4. Consumer Surplus Area
    • The area below the demand curve and above the price
  5. If price of good falls (if all things being equal)
    Consumer surplus increases.
  6. A supply curve can be used to measure
    • producer's surplus because it reflects the sellers cost
  7. Producer's Surplus
    The amount a seller is paid for a good minus the seller's cost of providing it
  8. Producer's Surplus Area
    • The area below the price above the supply curve
  9. Total Surplus
    • Consumer Surplus + Producer Surplus
Author
misol
ID
269621
Card Set
Econ Chapter 7
Description
Economics Chapter 7
Updated
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