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| | ''For Honors only'': There is an analogous "producer surplus" for the seller, which is the amount he obtained by selling at a price higher than what he would have been willing to sell. The supply curve illustrates that the supplier would have been able to make a few units to sell at only $1, $2, $3 and $4, as well as prices in between. But he was able to sell those units at the higher equilibrium price of $5, so he earned more money on those units than he would have otherwise. He has a "producer surplus" that is the area above the supply curve but below the P=$5 line. It is shown as the area within the lower triangle above. | | ''For Honors only'': There is an analogous "producer surplus" for the seller, which is the amount he obtained by selling at a price higher than what he would have been willing to sell. The supply curve illustrates that the supplier would have been able to make a few units to sell at only $1, $2, $3 and $4, as well as prices in between. But he was able to sell those units at the higher equilibrium price of $5, so he earned more money on those units than he would have otherwise. He has a "producer surplus" that is the area above the supply curve but below the P=$5 line. It is shown as the area within the lower triangle above. |
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| | == Exam Tips == | | == Exam Tips == |
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| − | We will have our midterm exam in two weeks (during class #9). Here are the topics that will be on the exam, with an approximate weighting similar to the CLEP exam for college credit: | + | We will have our midterm exam in two weeks (during class #9). Here are the topics that will be on the exam, with an approximate weighting similar to the CLEP exam (which is for college credit): |
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| | * 10%: The basics (defining economics, also scarcity and opportunity cost) | | * 10%: The basics (defining economics, also scarcity and opportunity cost) |
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| | * 15%: Utility, indifference curves | | * 15%: Utility, indifference curves |
| | * 30%: Decisions by a firm (cost measures, marginal product, short and long run, returns to scale, MR=MC) | | * 30%: Decisions by a firm (cost measures, marginal product, short and long run, returns to scale, MR=MC) |
| − | * 10%: Miscellaneous, including consumer surplus, efficiency, transaction costs, Coase theorem | + | * 10%: Miscellaneous, including consumer surplus, efficiency, transaction costs, Coase theorem, Gresham's Law |
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| | On any multiple choice exam, you can improve your score significantly by improving your test-taking skills. This includes: | | On any multiple choice exam, you can improve your score significantly by improving your test-taking skills. This includes: |
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| − | *reading the question carefully, and rereading if necessary; never miss a question due to misreading it | + | *reading the question carefully, and rereading if necessary; ''never miss a question due to misreading it'' |
| | *eliminating incorrect answers before choosing the correct one | | *eliminating incorrect answers before choosing the correct one |
| | *not leaving any questions unanswered if no points are deducted for wrong answers (neither the CLEP exam nor my exams deduct for wrong answers) | | *not leaving any questions unanswered if no points are deducted for wrong answers (neither the CLEP exam nor my exams deduct for wrong answers) |
| − | *preferring answers that are worded in a way that fits the question as a key fits a lock | + | *preferring answers that are worded in a way that fits the question, as a key fits a lock |
| | *disfavoring answers that have sweeping or broad terms in them, like ALWAYS and NEVER | | *disfavoring answers that have sweeping or broad terms in them, like ALWAYS and NEVER |
| | *avoiding changing answers away from your first impression, unless you have a good reason to do so. | | *avoiding changing answers away from your first impression, unless you have a good reason to do so. |
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| | Many questions on a multiple-choice exam can be answered correctly even though you didn't know the right answer beforehand, if you follow the above test-taking skills. One of my former students was told he would not have to take a particular exam in college, and he did not study for it, but was then surprised when the teacher made him take it anyway. Using these test-taking skills that he learned in my courses, he obtained the highest score -- higher than many students who studied many hours for the exam. | | Many questions on a multiple-choice exam can be answered correctly even though you didn't know the right answer beforehand, if you follow the above test-taking skills. One of my former students was told he would not have to take a particular exam in college, and he did not study for it, but was then surprised when the teacher made him take it anyway. Using these test-taking skills that he learned in my courses, he obtained the highest score -- higher than many students who studied many hours for the exam. |
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| | + | A competition is often won by the person who trained hard ''and'' tried the most during the competition. |
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| | ==Assignment== | | ==Assignment== |