ECON 2030 Lecture : Notes 2-27-12
Document Summary
Today"s menu: monday 27 february 2012: business, practice problems, chapter 8: 1, 3, 7-13, 16, 20, chapter 12: 1-3, 7-10, 12, 15. Substance: incidence of taxation, tools, elasticity, economic surplus. Two questions to answer: consumer surplus = cs, producer surplus = ps, government revenue = t x q, deadweight loss, examples (on sheet #3) 2& 3) how much qt changes which is related to how. ** gov"t should tax things that are very inelastic ex: sin tax (alcohol, smoking, gas all have very highly inelastic demands: examples, who bears the burden of a tax? (both b and s) (#4 on sheet) Buyers bear most of the burden (how do we figure out how much of burden) Change p on sellers (amt. they receive: theory of the firm: the basics, assumption, profit, definitions, total revenue (tr) Implicit: marginal revenue (mr, total cost (tc, marginal cost (mc, accounting, economic, maximizing rule: mr=mc, normal, example.
