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13 Cards in this Set
- Front
- Back
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Achieves allocative efficiency |
Socially optimum price |
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Regulated price high enough for monopolist to break even and conitinue operation |
Fair return price |
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Firm produced output at a cost higher than necessary |
X-inefficiency |
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Value of product goes up with number of users |
Network effects |
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Ability to satisfy large numbers of consumers |
Simultaneous consumption |
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Entry and exit does not affect resource prices or location of atc |
Constant cost industry |
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Effect That changes in the number of firms in industry will have on costs of individual firms |
Long run supply curve |
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Cost per unit of production increases as production increases |
Increasing cost industry |
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Lower costs as industry expands as well as a price drop when new firms enter and a price increase when firms exit |
Decreasing cost industry |
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Requires that gods be produced in least costly way |
Productive efficiency |
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Producing goods and services that are needed |
Allocative efficiency |
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Difference between maximum prices that consumers are willing too pay for a product and the market price |
Consumer surplus |
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Difference between minimum prices that producers will accept for a product and market price |
Producer surplus |
