Distribution of producer surplus and consumer surplus


Before 1991, the eight Ivy League colleges shared information and agreed on rules for setting their prices of education (price equals tuition minus scholarship). Since 1991, these schools have set their prices in competition with each other.

a. Compare the market for an Ivy league education before and after 1991

b. Predict what has happened to the efficiency of the market, to the distribution of producer surplus and consumer surplus, and to deadweight loss.

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Microeconomics: Distribution of producer surplus and consumer surplus
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