9-14-10

9-14-10 - ExamLike old exam to recordingDon’t have to...

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Unformatted text preview: 9-14-10ExamLike old exam formatCalculatorListen to recordingDon’t have to simplify everything like square root of 39 for exampleCan write directly on the examBoth mathematical and conceptional and graphicalDon’t worry about MRT (not a big deal)About 6 questions individually weighedSee sample practice keySolutions to chpt 4 and 5 are onlineSome of problems are in back of book if not posted Arrive by 3:25•S8oChooses pt d bc highest happiness on ICoFirst 100 dollars given for food they will use food stamps oOpportunity cost of using food stamps is 0 bc not allowed to spend on anything but foodoOp cost of 100 dollars is 100 bc you can use it on anythingoBudget line I sflast 0-100 bc giving up nothing oBeyond 100 dollars of food we go down the budget line bc now spending dollars that could be spent on other goodsoBudget set is light blue plus the green oAt e the MRS won’t be equal to budgetoMRS is actually steeper than zero but less steep than another oneoif gave person 100 in cash rather than food stamps it’s a shift from the first line to the line where f is including the dashed portionoconsumer would rather have $100 in cash than food stampsoso WHY give food stamps when could be happier in getting 100 dollars in cashto ensure it is used for foodwhy do they care to make sure they consume this particular good rather than other goods?•Bc if they don’t consume they might be in worse health and if they get sick and have to get care, these ppl can’t afford health svc and now the cost of health care falls on tax payersLower cost to society to give them food stamps and not cashAnother reason is to subsidize farmers•S10 – Labor SupplyoLeisure – any time you don’t work for moneyIn class is leisure by economist definitionAnything you’re not compensated for time (sleeping studying exercising etc)oIf not leisure it is WORKwork generates incomeAllows you to buy stuffW is a worker’s hourly wage...
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This note was uploaded on 10/03/2010 for the course ECON 410 taught by Professor Codrin during the Spring '07 term at UNC.

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9-14-10 - ExamLike old exam to recordingDon’t have to...

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