+
Related Flashcards
Related Topics
Cards In This Set
| Front | Back |
|
Price Ceiling
|
A legally determined maximum price that sellers may charge.
|
|
Price floor
|
A legally determined minimus price that sellers may recieve.
|
|
Consumer surplus
|
The difference between the highest price a consumer is willing to pay for a good or service and the price the consumer actually pays.
|
|
Marginal benefit
|
The additional benefit to a consumer from consumeing one more unit of a good or service.
|
|
Marginal cost
|
The additional cost to a firm of producing on e more unit of a good or service.
|
|
Producer surplus
|
The difference between the lowest price a firm would be willing to accept for a good or service and the price it actually recieves.
|
|
Economic surplus
|
The sum of consumer surplus and producer surplus.
|
|
Deadweight loss.
|
The reduction in economic surplus resulting from a market not being in competitive equilibrium.
|
|
Economic efficiency
|
A market outcome in which the marginal benefit to consumers of the last unit produced is equal to it marginal cost of production and in which the sum of consumer surplus and producer surplus is at a maximum.
|
|
Black market
|
A market in which buying and selling take place at prices that violate government price regulations.
|
|
Tax incidence
|
The actual dividision of the burden of a tax between buyers and sellers in a market.
|
|
Give an example of a price floor.
|
Minimum wage.
|
|
Give an example of a price ceiling.
|
Rent control.
|
|
Where can you find consumer surplus on a graph?
|
The area below the demand curve and above the market price.
|
|
Where can you find producer surplus on a graph?
|
The area above the market supply curve and below the market price.
|
