ECON 1050 Chapter Notes - Chapter 5: Externality, Avoidance Speech, Deadweight Loss

• School: University of Guelph
• Department: Economics
• Course: ECON 1050
• Professor: Eveline Adomait

Document Summary

Majority of voters choose how resource is allocated. Allocates resources to a winner (or a group of winners). Allocated resources to those who are first in line. Command system allocates resources by order of command (firms, government systems, etc. ) Those who can afford to pay but choose not to buy. Those who are too poor and simply can"t afford to buy. Two kinds of people decide not to pay the market price: Market price (use alternative methods to allocate resource) Value is what we get, price is what we pay. The market demand curve is the horizontal sum of the individual demand curves and is formed by adding the quantities demanded by all the individuals at each price. A demand curve is a marginal benefit curve. Individual demand relationship between the price of a good and the quantity. Allocate resources to those who up lucky on some a gaming system.