allative Cichy
Achieved when the
refers to
producing the
quantity of goods mostly wanted by society
.
allocates its that
economy
resources so
society gets the most benefits from consumption
DEMAND AS A MARGINAL BENEFIT CURVE IM B)
The quantity
greater the
good consumed by
of a a consumer
,
the
greater the satisfaction
But the ,
extra
benefit provided by each additional unit increases
by smaller and smaller ants
↳
marginal benefit
This means that the price the consumer is
willing to pay gets smaller as the number of units
bought
Increases ,
% consumers will
only be
willing to
buy an extra unit if the price falls .
SUPPLY AS A MARGINAL COST CURVE IM C) cost
p marginal
As the units of outputs increase ,
so does the extra cost to
produce one more output of the
good
This means that
producers will be willing to produce / sell an extra unit of the
good only it's price
increases .
C demand ) )
g) supply
curve ( curve
ALLO CAT WE EFFICIENCY 8 M¥ =
MC
6
extra benefit to society of getting one more unit of the
good = extra cost to
society of producing one more unit of the good .
Alternatively ,
if MB > MC ( more should be
produced ) society places a
greater value on an extra unit of the
good than
it costs to
produce it
if Mc > MB (less should be produced) It costs to produce extra unit
good than the value
more an
of the
society puts on it
Achieved when the
refers to
producing the
quantity of goods mostly wanted by society
.
allocates its that
economy
resources so
society gets the most benefits from consumption
DEMAND AS A MARGINAL BENEFIT CURVE IM B)
The quantity
greater the
good consumed by
of a a consumer
,
the
greater the satisfaction
But the ,
extra
benefit provided by each additional unit increases
by smaller and smaller ants
↳
marginal benefit
This means that the price the consumer is
willing to pay gets smaller as the number of units
bought
Increases ,
% consumers will
only be
willing to
buy an extra unit if the price falls .
SUPPLY AS A MARGINAL COST CURVE IM C) cost
p marginal
As the units of outputs increase ,
so does the extra cost to
produce one more output of the
good
This means that
producers will be willing to produce / sell an extra unit of the
good only it's price
increases .
C demand ) )
g) supply
curve ( curve
ALLO CAT WE EFFICIENCY 8 M¥ =
MC
6
extra benefit to society of getting one more unit of the
good = extra cost to
society of producing one more unit of the good .
Alternatively ,
if MB > MC ( more should be
produced ) society places a
greater value on an extra unit of the
good than
it costs to
produce it
if Mc > MB (less should be produced) It costs to produce extra unit
good than the value
more an
of the
society puts on it
