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Wednesday, October 4

  1. page Constant-Cost Industry edited ... Answer to practice problem: b. The ATC cost doesn't move at all because costs remain constant…
    ...
    Answer to practice problem:
    b. The ATC cost doesn't move at all because costs remain constant. The costs don't change ever, even with the addition of more firms to an industry.

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Monday, January 23

  1. page Monopoly is Not Allocatively Efficient edited MONOPOLY is NOT ALLOCATIVELY EFFICIENT ... at a priccvsdvdvdsvdsve price that will Neverth…

    MONOPOLY is NOT ALLOCATIVELY EFFICIENT
    ...
    at a priccvsdvdvdsvdsveprice that will
    Nevertheless, a monopoly can achieve allocative efficiency when they sell at the socially optimal price (where P=MC), when the government steps in. This solves underallocation, which yields allocative efficiency, yet it press the government to provide subsides for the monopoly. And in order to pay for these subsidies governments need to raise taxes, which in essence passes the costs on to the people again.This results in somewhat of a wash in a way.
    {http://www.uwcades.org/03fig1.gif} Look at where Qm is that is what is refered to as Q*.. The quantity that a monopoly will produce at... because this is not where Price = MC, it is not allocatively efficient.
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Sunday, July 31

  1. page Luxuries vs. Necessities edited ... which demand increases does not increase as income Necessities differ from luxury goods b…
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    which demand increasesdoes not increase as income
    Necessities differ from luxury goods because while the demand for necessities remains relatively constant, the demand for luxury goods fluctuates depending upon income and prices. Luxury goods have high income elasticity of demand which means as people become wealthier, they will buy more and more of the luxury good. This also means that if there was a decline in income, its demand will drop. With a shortage of income, less people are willing to buy expensive and unnecessary goods. However, necessities are always important.
    {luxury_good.jpg} {necessity.jpg}
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Monday, January 4

  1. page Monopoly is Not Allocatively Efficient edited MONOPOLY is NOT ALLOCATIVELY EFFICIENT ... at a price priccvsdvdvdsvdsve that will Neverth…

    MONOPOLY is NOT ALLOCATIVELY EFFICIENT
    ...
    at a pricepriccvsdvdvdsvdsve that will
    Nevertheless, a monopoly can achieve allocative efficiency when they sell at the socially optimal price (where P=MC), when the government steps in. This solves underallocation, which yields allocative efficiency, yet it press the government to provide subsides for the monopoly. And in order to pay for these subsidies governments need to raise taxes, which in essence passes the costs on to the people again.This results in somewhat of a wash in a way.
    {http://www.uwcades.org/03fig1.gif} Look at where Qm is that is what is refered to as Q*.. The quantity that a monopoly will produce at... because this is not where Price = MC, it is not allocatively efficient.
    (view changes)

Thursday, December 10

  1. page Fair-Return Price edited Fair Return Price ... with zero economicl economic profit. Yet For an example of this, pre…

    Fair Return Price
    ...
    with zero economicleconomic profit. Yet
    For an example of this, pretend that it is a heat industry. It costs them 1,000 dollars to cover average variable costs and average fixed costs. So, the government imposes a price control to keep the company from ripping off customers, especially with things like heating or other things that are closer to being inelastic. So, to keep the company from getting too much from the customer, they set the price so that it equals Average total costs. This way people aren't getting so much surplus taken from them, and the company is making a zero economic profit.
    Picture
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  2. page Fair-Return Price edited Fair Return Price ... with zero normal economicl profit. Yet For an example of this, prete…

    Fair Return Price
    ...
    with zero normaleconomicl profit. Yet
    For an example of this, pretend that it is a heat industry. It costs them 1,000 dollars to cover average variable costs and average fixed costs. So, the government imposes a price control to keep the company from ripping off customers, especially with things like heating or other things that are closer to being inelastic. So, to keep the company from getting too much from the customer, they set the price so that it equals Average total costs. This way people aren't getting so much surplus taken from them, and the company is making a zero economic profit.
    Picture
    (view changes)

Friday, October 30

  1. page Marginal Revenue edited Marginal Revenue ... revenue is a linear line, an upside down U-shaped curve, this means {ht…
    Marginal Revenue
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    revenue is a linear line,an upside down U-shaped curve, this means
    {http://tutor2u.net/economics/content/diagrams/pricing3.gif} {http://www.hmi.missouri.edu/course_materials/IndependentStudy/EconomicsIntro/images/Figure2-2.jpg}
    Links:
    ...
    Answer:
    b.

    (view changes)

Wednesday, February 18

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