Microeconomic Objectives of the Govt Flashcards
1
Q
What is equity?
A
Equity is defined as the fairness in the distribution of essential goods and services.
2
Q
What is ‘socially optimal level’?
A
It is the level pf consumption or production where society’s welfare is maximised and it occurs when the Marginal Social Benefit is equal to the Marginal Social Cost.
3
Q
What is deadweight loss?
A
It is the reduction in the net benefit to society when the output level is not at social optimum.
