Essay Questions Q surplus is an economic measure of consumer satisfaction that is mathematically arrived at through an analysis of the difference between the amounts the customer perceives a product to be worth and the amount they are willing to pay for it (Economics Online, nd). Further elucidation of the concept can be derived from the following analogy; a customer always wants to feel they are getting a good deal or bargain, for instance when one goes out to buy a new cellphone, they may be willing to spend $100 on it.
However when they get to the dealer, they find that the phone is only going for $45, in that case one can say there is consumer surplus of $55. Under premises in which income is deemed equitable in a given community, consumer surplus can be effectively used as a welfare measure. To determine the value of regulatory actions by government for instance, the changes in the economic welfare often have to be taken to account. The consumers will experience welfare impacts due the adjustment impact prices and consumption levels that result from regulatory measure by the government to reign in suppliers pricing options.
In a larger scale, this leads to economic welfare which is the overall benefit available to the general public from a commercial operation or condition, economic welfare is also referred to as social welfare and this is represented. Therefore, through an understanding of costumer surplus the general economic welfare of the community can also be understood and calculated comprehensively. Q. 2 The assumption that; jobs created to meet the requirements of a social project are not beneficial to society as a whole is erroneous cannot be logically defended.
Owing to the myriad social and economic problems that plague many communities, consummate efforts have been made by social organizations, governments and NGO to institute community projects to help mitigate some of these problems. Common issue includes social vices such as drug abuse, gang violence, domestic violence and sexual exploitation among others. Communities also often have to contend with, high crime rate, low education levels resulting from insufficient infrastructure or high school dropout rates, which can be attributed to some of the aforementioned factors.
In the endeavor to address the problems organizations often come up with a variety of social projects and initiatives most of which require they hire individuals with different designations. For instance, one of the organizations leading the fight against drug abuse in my community has created several jobs for counselors most of who are former addicts. Such jobs are very important to the community and the wider society; apart from the fact that they help tackle drug addiction which is not restricted to one community (Strang et al, 2012); they also create employment for the counselors, therefore reducing the overall unemployment rate.
This also has a positive impact in reducing crime rates and other social vices that are complement unemployment in the end (Brown, 2003). Therefore there are no reasonable grounds on which one can argue that creating such jobs is disadvantageous to the society, on the contrary they are play a key role in improving both local and national communities. References Economics Online. (n. d). “Consumer and producer surplus”. Retrieved from http: //www. economicsonline. co. uk/Competitive_markets/Consumer_and_producer_surplus. html Brown, G.
(2003). Drug abuse and addiction. Minority Nurse Newsletter, 10(3), 4. Strang, J., Babor, T., Caulkins, J., Fischer, B., Foxcroft, D., & Humphreys, K. (2012). Addiction 2: Drug policy and the public good: Evidence for effective interventions. The Lancet, 379(9810), 71-83.