Study guide for Midterm

Study guide for Midterm - Intro to economic analysis Fall...

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Unformatted text preview: Intro to economic analysis Fall 2010 Study guide for the midterm Chapter 2 on rational choice: Need to be able to check properties (i.e., completeness) and transitivity of an ordering expressed in words (e.g., "at least at tall as"). Particularly useful problems: 2.8.3-2.8.5. Also look at 2.8.8. Chapter 3 on Consumer choice: Need to be able to study a consumer problem by combining analytical and graphical methods. You should be able to use Lagrange optimization - though in the midterm substituting constraints in utility function will work. A good understanding of exercises 3.6.1-3.6.4 is of course necessary. But , in the midterm, a problem on this chapter would be one which you have never seen to test your ability to apply the methods in this chapter. I might even ask you to come up with a utility function from a verbal description of preferences, as in problem 3.6.7. Chapter 4 on Equilibrium: Need to be able to set up a competitive equilibrium as a set of maximization problems (one per agent) and system of equations (market clearing) to solve for prices. Need to be able to set up a social planner problem (and a Modified social planner problem) and solve it. A good understanding of exercises 4.6.2-3.6.4 is important and should be enough, though once again, in the midterm, a problem on this chapter would be one which you have never seen. Chapter 5 on Equilibrium in the labor market: By popular demand, the midterm will NOT have a formal question on this chapter. I might still make a reference to search, so as to make sure you read and understood the chapter. Chapter 6 on Time and uncertainty Need to be able to apply everything you know from chapter 3 and 4 to choice over time, along the lines of exercise 6.3.6 Study well section 6.2.4. Best of luck. ...
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This note was uploaded on 03/25/2011 for the course ECON 006 taught by Professor Bisin during the Spring '11 term at NYU.

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