econ101 lecture 7

private good

rival in consumption and exclusive in consumption

impure public good (club good)

not a rival in consumption

exclusive in consumption

impure public good (open access resource)

rival in consumption

not exclusive in consumption

pure public good

not a rival in consumption

not exclusive in consumption

demand curve shows us 2 things:

1 - it shows what quantity consumers are willing to buy given a price

2 - it shows us what consumers are willing to pay for a given quantity for the last unit

consumer's surplus

the difference between what the consumer is willing to pay and what the consumer has to pay (a benefit to the consumer)

discrete good

cannot break it down into pieces (like cars, TV)

market demand

deriving the market demand from individual demand curves is relativelyeasy for private goods, just horizontally sum the individual demands