In eachof the following cases, explain whether you thinkthe situation is efficie
ID: 1238357 • Letter: I
Question
In eachof the following cases, explain whether you thinkthe
situation is efficient or not. If it is notefficient, why not?
Whatactions would make the situationefficient?
a. Electricity is included in the rent at yourdorm. Some residents
in yourdorm leave lights, computers, andappliances
on whenthey are not in their rooms.
b. Although they cost the same amount to prepare,the cafeteria
in yourdorm consistently provides too many dishesthat
dinersdon’t like, such as tofu casserole, and too fewdishes
thatdiners do like, such as roast turkey withdressing.
c. Theenrollment for a particular course exceeds thespaces
available. Some students who need to take thiscourse to
complete their major are unable to get a spacewhile others
who aretaking it as an elective do get aspace.
Explanation / Answer
A. Inefficient because electrical cost is hidden and so studentsare unaware of the cost of their actions, use ore electricity thanthey would if they knew the cost. Bill them separately toreduce wasteful usage. B. Inefficient because producing on the productionspossibilities frontier so technically efficient but notallocatively efficient because producing too much bad food and toolittle good food. Adjust number of each meal type to reflectthe market demand. C. Inefficient because those who need class will not get itan my have to spend another semester in school when person takingit for an elective could take many other classes and give the seatto a needy person so both would graduate on time. Restrictthe class to students of that major for most of registration periodto be more efficient.