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Consumer Surplus
-Difference between maximum amounts a consumer is wishing to pay for a good and amount actually paid.
The stepladder demand curve is converted into a straight line demand curve by making the units of good smaller. Combining consumer surplus with aggregate profits which producers obtain we can evaluate:
1) Benefits and Costs of different market structures
2) Public policies which changes the behavior of consumers and firms
explain 6 factors that determine volume of production
Types of budget: Surplus Budget: A surplus budget occurs when the expected government revenue is planned to exceed the proposed government expenditure. It can be achieved by
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A consumer purchases food (X) and clothing (Y). Her utility function is given by: , income is $100 and the price of food is $1 and the price of clothing is Py. a. Derive the equ
Securitization: A process in that financial relationships (like loans) are converted into financial securities or assets (like bonds) that can be bought and re-sold in securities m
if the inverse demand curve is p=120-Qand the marginal cost is const ant at 10 ,
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