6.1  Describe alternative methods of allocating scarce resources.

 6.2   Distinguish between value and price and define consumer surplus.

 6.3   Distinguish between cost and price and define producer surplus.

 6.1   Describe alternative methods of allocating scarce resources.

- Prices
-  A command system
-  Majority rule
-  Contest
-  First-come, first-served
-  Sharing equally
-  Lottery
-  Personal characteristics
-  Force

 6.2   Distinguish between value and price and define consumer surplus.

A.  Marginal benefit is measured by the maximum price that consumers are willing to pay for a god or service.
B.  A demand curve is a marginal benefit curve.
C.  Value is what people are willing to pay; price is what people must pay.
D.  Consumer surplus equals marginal benefit minus price, summed over the quantity consumed.

 6.3   Distinguish between cost and price and define producer surplus.

A.  Marginal cost is measured by the minimum price producers must be offered to increase production by one unit.
B.  A supply curve is a marginal cost curve.
C.  Opportunity cost is what producers pay; price is what producers receive.
D.  Producer surplus equals price minus marginal cost, summed over the quantity produced.

Take the optional post-study bonus point quizzes on Efficiency and Fairness of Markets on Saturday following Module 2.

Take the optional pre-study bonus point quizzes on Government Influences on Markets on Sunday preceding Module 3.