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MICROECONOMICS (externalities (failure of the market to achieve a social…

- - - - cost of production
      - technology
      - number of firms in the market
      - tax/subsidy
    - - if the “c” term changes, there will be a shift of the supply curve.
      - change in “d” affects the steepness of the supply curve.
  - - - income
        
        normal goods
        
        inferior goods
      - preference/taste
      - substitutues/complements
      - demographic change
    - - changes in a, there will be a shift of the demand curve.
      - change in “b” affects the steepness of the demand curve.
  - - - the best allocation of resources from society’s point of view is at competitive market equilibrium, where social surplus (consumer surplus + producer surplus) is maximized
- - - - consumer
      - producer
      - government
  - - - government
      - consumer
      - producer
- - - - number and closeness of substitutes
      - degree of necesity
      - time to respond
      - proportion of income spent
  - - - time
      - mobility of factors of production
      - unused capacity
      - ability to store stocks
  - - - positive
    - - negative
  - - - positive
    - - negative