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Unformatted text preview: ECON201 Tutorial 6 2010 topics: Ethics, altruism, monopoly, multi-market pricing dates: 10 May - 14 May reading: Perloff § 11.1, § 12.4 Q1 Rationality and ethics 1. What are the conventional normative and positive assumptions per- taining to the role of ethics in human agency? 2. What are the implications of ‘ethical’ behaviour for economic outcomes or economic welfare according to the conventional wisdom 3. Can ethical behaviour be rational?According to the conventional wis- dom, ethical behaviour is irrational. Q2 Ethics and indifference curves 1. In the Diagram 1 below (on the last page), identify the utility maxi- mizing conventional economic agent. 2. Identify the ethical agent. Can this agent be utility maximizing? 3. Discuss and illustrate the implications of relative price and income changes upon the ethical agent. Q3 Single price monopoly Suppose that a single price monopolist faces an inverse demand curve of P = 140- 2 Q . Her firm has costs of C ( Q ) = 5 Q 2 ....
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