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Economic efficiency
.
11
Economics
Undergraduate 1
11/04/2009

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Term
Price ceiling
Definition
legally determined maximum a seller can charge for a good or product
Term
Price floor
Definition
legally determined minimum price sellers may receive
Term
Consumer surplus
Definition
the difference between what the consumer is willing to pay and what s/he actually pays
Term
Producer surplus
Definition
the difference between the lowest a producer is willing to accept and how much is actually accepted
Term
Where is producer surplus on the graph?
Definition
The area below the price and above the supply curve
Term
Where is consumer surplus on the graph?
Definition
The area below the demand curve and above the market price.
Term
Black market
Definition
A market in which activities violate government price settings.
Term
What is positive analysis concerned with?
Definition
Economic questions of "what is."
Term
What is normative analysis concerned with?
Definition
What ought to be.
Term
Excess burden
Definition
the deadweight loss resulting from tax
Term
Tax incidence
Definition
the actual division of the burden of tax
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