1. There are several methods for allocating resources of which one is market price. Explain.
2. Another method is the command system of allocating resources. Explain fully when it works best.
3. Explainwhen,why, and give an exampleof when a command system works badly. When applied to an entire economy.
4. Why does the 'contest' method of allocating resources work so effectively (give one or two examples also).
5. Explain the principle of decreasing marginal benefit.
6. In terms of marginal benefit and marginal cost, explain at what point would be the most efficient level of production. (don't just say where it is, but explain why it is the most efficient).
7. Explain the difference between consumer surplus and producer surplus.

Marginal benefit and marginal cost MC 10 8 . . . ... 6 MB 2 0 10 20 30 40 Quantity (thousands of pizzas per month) 8. In the figure above, what would be the most efficient combination of price and quantity in production of pizzas? 9. In the figure below, what is the consumer surplus? Marginal benefit and marginal cost MC 10 8 6 MB 2 0 10 20 30 40 Quantity (thousands of pizzas per month) 0. In the figure below, what does area 'B' represent