Ghoulish Externalities & Market Failure
This core equation defines Marginal Social Cost (MSC) by adding these two distinct cost components together
What are Marginal Private Cost (MPC) and Marginal External Cost (MEC)
The short run is defined as the time horizon during which at least one factor of production is held in this state.
Fixed
For a firm selling each unit of Halloween candy at a constant price of $5, this curve is perfectly horizontal and identical to Average Revenue (AR) and price (P).
What is the Marginal Revenue (MR) curve or Demand
This orange-wrapped, ribbed peanut-butter-and-chocolate treat is the most prized candy on Halloween.
Reese's Peanut Butter Cup
set out purposes or reasons/make the relationships between things evident/provide why or how.
Explain
When a factory discharges toxic sludge into a local river, market equilibrium output occurs where MPB = MPC. In contrast, the socially optimal level of output occurs at this exact condition.
MSB = MSC
This fundamental economic law states that as increasing quantities of a variable factor are added to a fixed factor, the additions to total output eventually decline.
DMR
This level of profit is treated as a cost of production and represents the minimum return necessary to keep an entrepreneur in business.
Normal Profit
In the Netflix hit series spinoff of The Addams Family, Jenna Ortega plays this character, whose chaotic dance scene to "Goo Goo Muck" went ultra-viral on TikTok.
Wednesday
When drawing cost curves in an essay, forgetting to label the two axes correctly costs immediate marks. In Chapter 34 micro diagrams, the vertical axis should be labeled "Cost / Revenue / Price" and the horizontal axis must strictly be labeled this.
Output or Quantity
When a buyer knows far more about the real risks or defects of an asset than the seller (or vice versa), this specific type of information failure causes market failure through adverse selection.
Asymmetric Information
On any standard short-run diagram, the Marginal Cost (MC) curve always cuts both the Average Variable Cost (AVC) and Average Total Cost (ATC) curves at these exact points.
Minimum Point
Any earnings earned by a firm over and above normal profit are known by this economic term.
Supernormal Profit
In this iconic 2016 Korean horror blockbuster, Gong Yoo and his daughter fight for survival against hordes of infected zombies aboard a high-speed KTX heading south from Seoul.
Train to Busan
When sketching a market externality diagram for Chapter 33, examiners will penalize you if your Deadweight Welfare Loss triangle points away from the center. A student memory rule states the DWL triangle arrow must always point directly toward this specific output point.
Socially Optimal Output
A haunted amusement park buys comprehensive insurance against property damage and immediately stops paying for night-time security guards. Name this specific economic problem where an insured party changes behavior because third parties bear the cost of risk.Mor
Moral Hazard
If a zombie makeup lab doubles all its productive inputs and total output increases by more than double, the firm is experiencing this long-run phenomenon.
Increasing Returns to Scale
Regardless of market structure, any firm seeking to maximize total profits will produce output where these two marginal measures are equal.
MR=MC
Set in the fictional town of Hawkins, Indiana, this massive Netflix sci-fi horror series follows a group of kids battling terrifying creatures from an alternate dimension known as the "Upside Down."
Stranger Things
A chemical manufacturing plant dumps hazardous waste into a river while producing plastic containers for Halloween costumes. Assume there are no consumption externalities (MSB = MPB), but production generates a significant marginal external cost (MSC > MPC).
On your team sheet:
Sketch and fully label the market diagram showing the free-market output and price
(Qm, Pm) versus the socially optimal output and price (Qs, Ps).
Clearly shade and label the Deadweight Welfare Loss (DWL) triangle.
mpc and msc is left of it with dwl triangle facing left. social price should be higher and Q should be lower
In an externality diagram, the triangular area representing net social welfare lost due to overproduction or underproduction is known by this three-word term.
Deadweight Loss
On a Long-Run Average Cost (LRAC) curve, this is the specific term for the lowest level of output at which a firm first achieves its lowest possible unit cost.
What happens to Total Revenue (TR) at the exact output where the $MR$ line crosses the horizontal axis (MR = 0)?
TR is at its peak
In this gory apocalyptic Netflix series adapted from a popular webtoon, residents of the "Green Home" apartment complex fight against neighbors who turn into grotesque monsters reflecting their deepest, darkest human desires.
Sweet Home
Every October, Everland transforms its Alpine Village into this infamous after-dark immersive zone filled with giant zombie animatronics, live-actor scare mazes, and flash mobs, recently partnering with Netflix series like All of Us Are Dead and Stranger Things.
What is Blood City (블러드시티)?