ECON 103 Lecture Notes - Lecture 18: Economic Surplus, Perfect Competition, Marginal Revenue
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Important announcements: most of this class was spent discussing different topics for industry analysis and the last. 10 minutes of the class were spent discussing perfect competition: the industry analysis assignment is due friday, november 16th, the assignment is not a big research project, it will test only how you think about and apply ttaro. The three tests of allocating resources (ttaro) (review for industry analysis: the right consumers. Is whatever that is produced going to the consumers that value it the most or can the consumer surplus be increased: the right producers. Is whatever that is being produced made at the lowest possible cost or can the producer surplus be increased: the right amount. Note: the three tests are used to judge whatever allocation of resources and outputs exist, regardless of how that allocation came about. Competition: the goal of any firm is to maximize its profits ()
