1. In social welfare economics, what is the definition of social efficiency? 2. Image (A) below depicts social welfare in a market with a monopolistic seller. Is this market socially efficient? Why or why not? 3. Image (B) below depicts social welfare in a market with a monopolistic seller who is allowed to price discriminate (i.e. charge different prices to different consumers for the exact same good). Is this market socially efficient? Why or why not? Is it equitable? Why or why not? WIL in leellis JG

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1. In social welfare economics, what is the definition of social efficiency?
2. Image (A) below depicts social welfare in a market with a monopolistic seller. Is this market
socially efficient? Why or why not?
3. Image (B) below depicts social welfare in a market with a monopolistic seller who is allowed to
price discriminate (i.e. charge different prices to different consumers for the exact same good). Is
this market socially efficient? Why or why not? Is it equitable? Why or why not?
4. What is meant by the equity-efficiency tradeoff in social welfare economics?
Price
Pu
P
Consumer
Surplus
Transfer
Producer
Surplus
Deadweight
B Loss
A
Qu
A
QE
MC
Demand
Quantity
Price
P
Producer
Surplus
E
Q₁
MC
Demand
Quantity
Transcribed Image Text:1. In social welfare economics, what is the definition of social efficiency? 2. Image (A) below depicts social welfare in a market with a monopolistic seller. Is this market socially efficient? Why or why not? 3. Image (B) below depicts social welfare in a market with a monopolistic seller who is allowed to price discriminate (i.e. charge different prices to different consumers for the exact same good). Is this market socially efficient? Why or why not? Is it equitable? Why or why not? 4. What is meant by the equity-efficiency tradeoff in social welfare economics? Price Pu P Consumer Surplus Transfer Producer Surplus Deadweight B Loss A Qu A QE MC Demand Quantity Price P Producer Surplus E Q₁ MC Demand Quantity
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