22 | Economic Surplus
The amount of surplus generated in a market depends on the quantity traded, and who is trading.
A video on deadweight loss and Christmas.
A brief video on pareto optimality and pecan pie.
A video on deadweight loss and Christmas.
In this video, we explore the fourth unintended consequence of price ceilings: deadweight loss. When prices are controlled, the mutually profitable gains from free trade cannot be fully realized, creating deadweight loss
Recent regulatory blowback against Uber, Lyft and other ridesharing services around the world have reignited the ongoing regulatory policy debate surrounding the ride service in India, Uber’s second biggest market in terms of cities where it operates.
A brief video that expands on the concept of the production possibilities curve.
Price floors, when prices are kept artificially high, lead to several consequences that hurt the consumer. In this video, we take a look at the minimum wage as an example of a price floor.
What was the greatest invention of the industrial revolution? Hans Rosling makes the case for the washing machine.
A brief video introducing the idea of the production possibilities curve.
In this video, we explore the relationship between price and quantity supplied. Why does the supply curve slope upward?
A brief video on economic equilibrium, presented by Paul Solman.
Paul Solman presents this video on equilibrium prices.
In this video, we’ll review equilibrium in the adjustment process, showing that the equilibrium price is the only stable price. Then we’ll take a look at equilibrium quantity, where quantity demanded is equal to quantity supplied, and how this plays out in a free market economy that seeks to maximize gains from trade.
A lesson plan on demand, supply, and the market.
This lesson focuses on suppliers and demanders, the participants in markets; how their behavior changes in response to incentives; and how their interaction generates the prices that allocate resources in the economy. Learning about the reaction of demanders and suppliers to price, and the impact of non-price conditions (the determinants of demand and supply) creates a foundation for understanding the dynamism of markets. Examining the interaction of consumers and producers as they respond to market conditions also generates an appreciation for the role of prices in transmitting information that coordinates the economic response to scarcity. The dynamics of the market, a vital part of students’ understanding of economics, may be explained with tables and narrative, or with graphs, or both – whatever is best suited to individual learning styles.
A classroom activity designed by the Federal Reserve Bank of Atlanta.
The concept of supply and demand is often considered the heart and soul of economics. It is the foundation for much of what is studied in the field, and understanding how supply and demand affect the economy can help us to recognize economics everywhere in our daily lives. (The British classical economist J.R. McCulloch is attributed with the famous saying that you can make a parrot an economist if you only teach it to say "supply and demand.") The supply and demand infographic highlights basic concepts such as the laws of supply and demand, changes in demand and supply versus changes in the quantity demanded and the quantity supplied, the determinants of demand and supply, and market equilibrium.
How do increases or decreases in demand affect the demand curve? An increase in demand means an increase in the quantity demanded at every price.
This video looks at both the horizontal and vertical methods for reading the demand curve, how demand curves shift, and consumer surplus.
An inferior good is a good or service where your demand goes down when your income goes up, and vice versa.