Social Planner
A benevolent planner maximizes societal welfare by ensuring the market reaches equilibrium where total surplus is highest.
Total Surplus = CS + PS = Value - Cost
Equilibrium
Quantity Demanded (Qd) = Quantity Supplied (Qs) at point E.
Market State Simulator
At Equilibrium (Clearing)
Market ClearanceQuantity demanded equals quantity supplied. Total surplus is maximized; no pressure for price change.
Interactive Equilibrium
⚖️ Equilibrium₹20₹60₹100
Efficiency vs. Equality
Efficiency maximizes the size of the economic pie (total surplus).
Equality focuses on how the pie is divided among participants.
Efficiency ≠ Equality
Underproduction (Q₁)
Value to buyers exceeds cost to sellers. Producing more increases total surplus.
Overproduction (Q₂)
Cost to sellers exceeds value to buyers. Producing less avoids welfare loss.