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Definition
| The amount a buyer is willing to pay for a good minus the amount the buyer actually pays for it. |
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Definition
| The value of everything a seller must give up to produce a good. |
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Definition
| The property of society getting the most it can from its scarce resources. |
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Definition
| The property of distributing economic prosperity uniformly among the members of society. |
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Term
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Definition
| The amount a seller is paid for a good minus the seller's cost of providing it. |
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Term
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Definition
| The study of how the allocation of resources affects economic well-being. |
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Term
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Definition
| The maximum amount that a buyer will pay for a good. |
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Definition
| The proposition that if private parties can bargain without cost over the allocation of resources, they can solve the problem of externalities on their own. |
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Definition
| A tax designed to induce private decision makers to take account of the social costs that arise from a negative externality. |
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Term
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Definition
| The uncompensated impact of one person's actions on the well-being of a bystander. |
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Term
| internalizing the externality |
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Definition
| Altering incentives so that people take account of the external effects of their actions. |
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Term
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Definition
| The costs that parties incur in the process of agreeing to and following through on a bargain. |
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