Economics 1021A/B Lecture Notes - Lecture 11: Economic Surplus, Economic Equilibrium, Competitive Equilibrium

• School: Western University
• Department: Economics
• Course: Economics 1021A/B
• Professor: Jeannie Ann Shearer

Document Summary

Announcements: midterm exam: saturday oct. 20 7pm, note that the other sections write at other times make sure you are there at. The difference between these is your consumer surplus. Another way would be to calculate the area of the rectangle and triangle (but this is more difficult. ) Example: what would the demand curve look like if both bill and ted buy 15 chocolate bars and both pay the same price (they will each go through the same point on the demand curve), but. Bill"s de(cid:373)a(cid:374)d is (cid:373)ore elasti(cid:272) tha(cid:374) ted"s (cid:894)bill"s de(cid:373)a(cid:374)d (cid:272)ur(cid:448)e (cid:449)ill (cid:271)e (cid:373)ore horizo(cid:374)tal(cid:895): note that both demand curves should intersect the y-axis. Example: a marginal cost curve tells you how much it costs to produce an additional unit. When pizza house produces the 25th pizza, it costs to produce it. When it produces the 50th pizza, it costs to produce it.