tailieunhanh - Lecture Principles of Microeconomics: Chapter 6 - James D. Miller

Lecture Principles of Microeconomics: Chapter 6 - Wealth creation and destruction. After reading this chapter, you should be able to answer the following questions: What is wealth? What creates wealth? How is wealth destroyed? What is consumers’ surplus? What is producers’ surplus? When is total surplus to society maximized? What is deadweight loss? How do government set prices, taxes and subsidies create deadweight loss? How do innovations affect a market economy? | Chapter 6 Wealth Creation And Destruction McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All Rights Reserved. Learning Objectives What is wealth? What creates wealth? How is wealth destroyed? What is consumers’ surplus? What is producers’ surplus? When is total surplus to society maximized? What is deadweight loss? How do government set prices, taxes and subsidies create deadweight loss? How do innovations affect a market economy? 6- What Is Wealth? The value of a good is the most its owner would pay for it. An individual’s wealth is the value of all his possessions. The total wealth of society is the sum of each individual's wealth. Money transfers have no effect on the wealth of society. 6- Wealth Creation Voluntary trade increases wealth of society since it moves goods to someone who places higher value on them. Production as well as trade can increase wealth. Trade allows the manufacturer to produce goods. A manufacturer will only sell a | Chapter 6 Wealth Creation And Destruction McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All Rights Reserved. Learning Objectives What is wealth? What creates wealth? How is wealth destroyed? What is consumers’ surplus? What is producers’ surplus? When is total surplus to society maximized? What is deadweight loss? How do government set prices, taxes and subsidies create deadweight loss? How do innovations affect a market economy? 6- What Is Wealth? The value of a good is the most its owner would pay for it. An individual’s wealth is the value of all his possessions. The total wealth of society is the sum of each individual's wealth. Money transfers have no effect on the wealth of society. 6- Wealth Creation Voluntary trade increases wealth of society since it moves goods to someone who places higher value on them. Production as well as trade can increase wealth. Trade allows the manufacturer to produce goods. A manufacturer will only sell a good for more than it costs to increase wealth and buyer will only pay an amount less than what the good is worth to her. 6- Wealth Creation The growth rate of wealth creation over the long run is the most important force shaping a society. 6- Destruction Of Wealth By Governments Rent control: It reduces trade by eliminating incentives of some sellers to sell. Minimum wage: It reduces trade by eliminating incentives of some buyers to buy. Taxes: Taxes reduce trade by eliminating incentives of some buyers as well as sellers as a tax raises consumer’s price and lowers producer’s price. Subsidies: Subsidies destroy wealth by encouraging wastage and misallocation of resources. 6- Destruction Of Wealth By Governments Forced sharing: It destroys wealth by reducing incentives for hard work. Theft: Unlike voluntary trade, theft may not move goods to someone who places higher value on them. Eminent domain = Power of a government to take private property. The society’s .

• Kinh tế học
• Principles of Microeconomics
• Lecture Principles of Microeconomics
• Wealth creation
• Wealth creation
• Production cost
• Total surplus
• Ten principles of economics
• Scarce resources
• Scarcity implies choice
• Choice implies cost
• Thinking like an economist
• Economic models
• Circular flow diagram
• Production possibilities frontier
• The gains from trade
• Production possibilities
• Comparative advantage
• Absolute advantage
• Market forces
• Supply and demand
• Market economies
• Competitive markets
• Price elasticity of demand
• Price elasticity
• Midpoint method
• Demand curves
• Controls on prices
• Price ceiling
• Price floor
• Market outcomes
• Market failures
• Negative externalities
• Positive externalities
• Market inefficiency
• Public goods
• Common resources
• Types of goods
• Cost benefit analysis
• Tax system
• Federal government
• Marginal tax rate
• Budget surplus
• Costs of production
• Total revenue
• Total cost
• Opportunity costs
• Firms in competitive markets
• Average revenue
• Marginal revenue
• Sunk costs
• Monopoly resources
• Government created monopolies
• Natural monopolies
• Monopoly’s revenue
• Monopolistic competition
• Nash equilibrium
• Equilibrium for oligopoly
• Game theory
• Long run equilibrium
• Perfect competition
• Production possibility frontier
• Opportunity cost
• Rational people
• Indirect effects
• Law of demand
• Factors change demand
• Law of supply
• Market demand
• Demand intersect
• Demand determine prices
• Change in demand
• Change in supply
• Elastic demand curve
• Policy analysis with supply
• Policy analysis with demand
• International trade
• Additional benefits of trade
• Average costs
• Break even price
• Increasing marginal costs
• Long run analysis
• Firms profit graphically
• Accounting profit
• Market effectiveness
• Monopolist pricing
• Price discrimination
• Antitrust laws
• Disruptive innovation in oligopolies
• Predatory pricing