CAS EC 101 Study Guide - Midterm Guide: Opportunity Cost, Sony Max, Competitive Equilibrium

• School: Boston University
• Department: Economics
• Course: CAS EC 101
• Professor: Michael Manove

Document Summary

Producer surplus: sum of profits created as units are produced. Costs that enable production to begin are not subtracted from producer surplus. Economic efficiency : measures how well economic activity fulfills its value creating. Pareto improvement : if some people are better off after the change but no ones is worse. Pareto efficient: when there are no pareto improvements to be made. Economic surplus : measures the benefits of economic activity in monetary units. Consumer surplus : is the benefit obtained by consumers. Producer surplus : is the benefit obtained by producers. Social surplus : consumer surplus + producer surplus. Dwl : the social surplus that is missing. Price ceiling : a government set max price. Price floor : a government set min price. Exp: legal min wages price creates excess demand. Rent controls : legal regulation that controls apt rental prices. Nonprice- rationing : distributing goods without using prices occur when the prevailing.