Question

In: Economics

The enrollment for ECON 290 exceeds the spaces available. Some students who need to take this...

The enrollment for ECON 290 exceeds the spaces available. Some students who need to take this course to graduate are unable to get a space even though others who are taking it as an elective do get a space.

a) Is this situation allocatively efficient? Briefly explain.

b) Is this situation Pareto efficient? Why or why not? Briefly explain. If it is not efficient, what action would make a Pareto improvement?

Solutions

Expert Solution

a) This is not allocatively efficient. This is because the course should have been allocated such that the people for whom it is a graduate subject should have been allocated first and the electives should have been allocated later.

On the other hand here, the electives are getting a space while the ones who need it to graduate are not. Hence it is not allocatively efficient.

b) Pareto efficiency is when one is made better off without making someone else worse off. This is not efficient because here the one who values the course somewhat less than the ones who value it more are able to get it. In other words, the ones who need it to graduate would have attached a higher value to the subject or the course, than the ones for whom the subject would just be an elective.

For pareto improvement, trading takes place. In this case also the trading could take place wherein the students who are electives or value the course less than the others ie are indifferent between certain courses can trade with students who would be better off after getting a seat in this course. This way the elective student might be at a better place or be indifferent and the graduate student would be better off.

Hence this place would be pareto optimal wherein one is made better off without making anyone else worse off.


Related Solutions

Based on the limited amount of available student parking spaces on the GSU campus, students are...
Based on the limited amount of available student parking spaces on the GSU campus, students are being encouraged to ride their bikes (when appropriate). The administration conducted a survey to determine the proportion of students who ride a bike to campus. Of the 123 students surveyed 5 rides a bike to campus. Which of the following is a reason the administration should not calculate a confidence interval to estimate the proportion of all students who ride a bike to campus?...
Some five courses are offered on campus in a semester. The group of students who take...
Some five courses are offered on campus in a semester. The group of students who take at least one of these courses consists of 155 students. There are 80 students registered in each course. For any two among these courses, there are precisely 40 students who take both of them. For any three of these courses, there are precisely 20 students who take all three of them. For any four among these courses, there are precisely 10 students who take...
In a team, there are some who prefer to take the initiative and others who prefer...
In a team, there are some who prefer to take the initiative and others who prefer to be told what to do, what are the benefits and drawbacks of each preference? How does this preference affect his or her role in the team? As a team leader, how important is it for you to recognize the difference?
Dan believes the success rate of students who take a morning class is higher than students...
Dan believes the success rate of students who take a morning class is higher than students who take an afternoon class in the same subject. In a morning class of 34 students, 30 have passing grades (C or better). In an afternoon class of 25 students, 18 have passing grades. What is H0: What is Ha: What is the p-value? Round answer to three decimal places (i.e. 0.123)? Answer At a level of significance (alpha) of 0.05, what is your...
The FMLA was intended to be a benefit to employees who need to take off work...
The FMLA was intended to be a benefit to employees who need to take off work for an extended period of time to deal with family medical related issues. What do you see as the primary benefit of the act? What are some weaknesses of the act from an employee and an employer perspective? How would you change the act to make it both beneficial to employees and fair to employers?
what are some changing economic factors that hsbc will need to take into consideration in the...
what are some changing economic factors that hsbc will need to take into consideration in the coming years
     The mean height of a random sample of 47 students who take part in athletic...
     The mean height of a random sample of 47 students who take part in athletic activities at NRDC is 175cm with a standard deviation of 5cm while a random sample of 132 students who showed no interest in athletics had a mean of 170cm and a standard deviation of 7cm. (a) Construct a 99% confidence interval for the difference in the mean heights of the two groups of students. (b) Are students who take part in athletic activities taller?...
A statistics professor at a large university hypothesizes that students who take statistics in the morning...
A statistics professor at a large university hypothesizes that students who take statistics in the morning typically do better than those who take it in the afternoon. He takes a random sample of 36 students who took a morning class and, independently, another random sample of 36 students who took an afternoon class. He finds that the morning group scored an average of 72 with a standard deviation of 8, while the evening group scored an average of 68 with...
What are some of the limits that are placed on who may take cases to court...
What are some of the limits that are placed on who may take cases to court and the types of cases courts will consider? How does this differ between federal and state courts? This is one of the disussion questions in the book: Problems in Healthcare)
60% of all students at a college still need to take another math class. If 49...
60% of all students at a college still need to take another math class. If 49 students are randomly selected, find the probability that a. Exactly 26 of them need to take another math class.____   b. At most 31 of them need to take another math class.____    c. At least 28 of them need to take another math class.____    d. Between 25 and 31 (including 25 and 31) of them need to take another math class.____  
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT