Econ Quiz 3

  1. welfare economics
    the study of how the allocation of resources affects economic well-being
  2. willingness to pay
    the maximum amount that a buyer will pay for a good
  3. consumer surplus
    the amount a buyer is willing to pay for a good minus the amount the buyer actually pays for it
  4. cost
    the value of everything a seller must give up to produce a good
  5. producer surplus
    the amount a seller is paid for a good minus the seller's cost of providing it
  6. efficiency
    the property of society getting the most it can from its svarve resources
  7. equality
    the property of distributing economics prosperity uniformly among the members of society
  8. deadweight loss
    the fall in total surplus that results from a market distortion, such as a tax
  9. world price
    the price of a good that prevails in the world market for that good
  10. tariff
    a tax on goods produced abroad and sold domestically
  11. externality
    the uncompensated inpact of one person's actions on the well-being bystander
  12. internalizing the externality
    altering incentives so that people that amount of the external effects of their actons
  13. corrective tax
    a tax designed to induce private decisions maturs to take account of the social costs that arise from a negative externality
  14. Coase Theorem
    the proposition that if private parties can bargin without coast over the allocation of resources they can solve the problem of externalities on their own
Card Set
Econ Quiz 3
economics vocab