If you want to pass this class, use these notes. Period. I for sure will!
*cumulative, with higher focus on new material*
Comparative Advantage Specialization between 2 people who can be ore efficient at doing a single task and acquiring the other.
Monopoly Single seller, can control price. Not Perfectly Competitive. Marginal Cost Change in cost per additional unit sold
Marginal Revenue Change in revenue per additional unit sold. First unit=Revenue ATC Total Cost/ Quantity Sold Don't forget about the age old question of What it means to be part of the west today?
Total Revenue Price x Quantity Sold.
Graphs to Know:
Consumer Surplus (triangle) Under demand line, above optimal price. Producer Surplus (Square) Under demand line, below optimal price to xaxis.If you want to learn more check out What is cell shape determined by?
Social Surplus Producer surplus + consumer surplus
Deadweight Loss Profit lost in society, not gained by producer or consumer. (Usually = Consumer Surplus). We also discuss several other topics like What are the 5 components of blood?
We also discuss several other topics like What human population (hint: gender) is most susceptible to the above condition?
We also discuss several other topics like What does it mean when herman’s physician told him that he is “salt-sensitive”?
We also discuss several other topics like Why has the islamic faith been singled out?
Optimal Selling Price Marginal Cost lining up with Demand line and Marginal Revenue
ATC of Monopoly Downward sloping curve.
Marginal Revenue 2x slope of Demand Curve.
Graphs for Comparative/Absolute Advantage
Equilibrium Quantity Graphs (Stairs) if passes equilibrium quantity, values begin to subtract. Arithmetic of quantity x price across the graph.
60 MC, 4/5 Free Response. 220 points available, graded out of 200. Calculate Comparative/Absolute Advantages from PPC on graph or charts. Calculate profit given after solving marginal revenue and optimal quantity sold.
Price = Marginal Cost = Marginal Revenue in Perfectly Competitive Market.
Monopolies work in economies of scale, so they can have lower prices to produce and higher to sell.
Finding Reservation Price.
Do the Free response FIRST. Multiple Choice 2 pts each.