Describe Two Potential Advantages and Two Potential Disadvantages of Final

question 47

Essay

Describe two potential advantages and two potential disadvantages of final offer selection.

---

Definitions:

Deadweight Loss

A loss in total societal welfare that occurs when market equilibrium is not achieved or when market imperfections exist, leading to inefficient allocation of resources.

Relatively Inelastic

Describes a situation where the demand for a good or service changes by a smaller percentage than changes in its price.

Deadweight Loss

A situation where inefficiency in the market leads to a loss of total social welfare, typified by a gap between the supply and demand curves.

Relatively Elastic

Describes a situation where the demand or supply for a good or service significantly changes in response to changes in price.