Week 4 Flashcards Preview

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Flashcards in Week 4 Deck (13):
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

A buyer's willingness to pay minus the amount the buyer actually pays

4

A buyer's willingness to pay minus the amount the buyer actually pays

Consumer surplus

5

The value of everything a seller must give up to produce a good

Cost

6

Producer surplus

The amount a seller is paid for a good minus the seller's cost

7

The amount a seller is paid for a good minus the seller's cost

Producer surplus

8

Price ceiling

A legal maximum on the price at which a good can be sold

9

A legal maximum on the price at which a good can be sold

Price ceiling

10

Price floor

A legal minimum on the price at which a good can be sold

11

Tax incidence

The study of who bears the burden of taxation

12

Deadweight loss (taxation)

The reduction in total surplus that results from a market distortion such as a tax or a monopoly price

13

The reduction in total surplus that results from a market distortion such as a tax or a monopoly price

Deadweight loss (taxation)