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Total Social Surplus = Consumer Surplus + Producer Surplus
Total Social Surplus = Value to Buyers – Costs of sellers = Sum to Marginal Benefits – Sum of Marginal Costs Consumer Surplus Producer Surplus
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Market intervention and inefficiency
1. Deadweight loss
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Market intervention and inefficiency
2. Deadweight loss
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Market intervention and inefficiency
3. Deadweight loss
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Market intervention and inefficiency
4. Deadweight loss
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Market intervention and inefficiency
5. Deadweight loss
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Summary of market intervention and deadweight loss
Effect MB vs. MC at Qt Price ceiling Under-production MB > MC Price floor Quota Unit tax Unit subsidy Over-production MB < MC
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Elasticity of demand and deadweight loss
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Elasticity of demand and deadweight loss
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Elasticity of demand and deadweight loss
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Elasticity of demand and deadweight loss
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Elasticity of demand and deadweight loss
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Elasticity of supply and deadweight loss
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Elasticity of supply and deadweight loss
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Elasticity of supply and deadweight loss
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Elasticity of supply and deadweight loss
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Elasticity of supply and deadweight loss
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Summary of elasticity of demand/supply and deadweight loss
Price ceiling Smaller Larger Price floor Quota Unit tax Unit subsidy Supply Elasticity of supply Deadweight loss Price ceiling Larger Price floor Smaller Quota Unit tax Unit subsidy
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