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Todaro - Chapt10
Todaro - Chapt10
The Environment
and Development
– Clean air
– Arable land
– Safe drinking water
– Forests
– Mineral deposits
Price Supply
Consumer Surplus
P Marginal Cost
Producer Surplus or Scarcity Rent
Demand
Q Quantity
Price
By reducing consumption from 75 to 50, price goes
up to PS and producer surplus increases by PSPab
Ps a
P MC
b
Demand
50 75 Quantity
AP* C
W D E Wage
Marginal Product of Labor
Average Product of Labor
L* Lc No. of Workers
A+B
Price
Q* = Qa + Qb; Pa < Pm; Pb < Pm
B
A Aggregate Demand
c MC
Pm b
Pb Aggregate Supply
Pa a
Qa Qb Q* Quantity
Price MCS
MCP
a Supply
P*
PM b Dead-Weight Loss = abc
PC
c
Demand
Q* QM Quantity
– Economic growth
– Population growth
Price MCS
P2 MCP
P*
P1
D2
D1
Quantity
Q* Q1 QM
• Emission control
• Import restrictions