Lecture+10+October+11

Lecture+10+October+11 - Todays agenda Nobel Prize...

Info iconThis preview shows pages 1–15. Sign up to view the full content.

View Full Document Right Arrow Icon
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Today’s agenda Nobel Prize announcement this morning Consumer choice Budget lines and budget sets Preferences
Background image of page 2
Regular office hours tomorrow cancelled If you were planning to see me tomorrow morning, please either Come to my regular office hour this afternoon at 4:30 next door in NJ 303a or Email or speak to me to set up an appointment at another time.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2010 Nobel Prize in Economics
Background image of page 4
2010 Nobel Prize in Economics Standard model Buyers and sellers find each other immediately, costlessly Buyers and sellers have full information about all prices and characteristics of available goods. Result: markets clear. No surpluses or shortages. Outcomes are efficient. Poor fit for some important markets Labor markets Housing markets Marriage markets DMP model Search activity of the unemployed Recruiting behavior of firms Wide implications for design of unemployment policy design and even monetary policy
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Where we’ve been and where we’re headed. .. First phase of the course: Introduction to supply and demand Brief look at efficiency of markets and potential for market failure Second phase: Behind the demand and supply curves Relate them to optimizing behavior by consumers and firms in an equilibrium model Explain the negative slope of demand curves Explain the positive slope of supply curves
Background image of page 6
Goals of the next two classes Explain the “Law of Demand” the inverse relationship between P and Q D Introduce utility and indifference curves geometric way to describe preferences useful here and later in welfare economics
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
From individual to market demand $/Q Q $/Q Q $/Q Q Consumer 1 Consumer 2 Market demand
Background image of page 8
From individual to market demand $/Q Q $/Q Q $/Q Q Consumer 1 Consumer 2 Market demand
Background image of page 9

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
From individual to market demand $/Q Q $/Q Q $/Q Q P 1 ac Consumer 1 Consumer 2 Market demand
Background image of page 10
From individual to market demand $/Q Q $/Q Q $/Q Q P 1 P 2 ab c d Consumer 1 Consumer 2 Market demand
Background image of page 11

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
From individual to market demand $/Q Q $/Q Q $/Q Q P 1 P 2 ab c d a+c Consumer 1 Consumer 2 Market demand
Background image of page 12
From individual to market demand $/Q Q $/Q Q $/Q Q P 1 P 2 ab c d a+c b+d Consumer 1 Consumer 2 Market demand
Background image of page 13

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
From individual to market demand $/Q Q $/Q Q $/Q Q P 1 P 2 ab c d a+c b+d Consumer 1 Consumer 2 Market demand
Background image of page 14
Image of page 15
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 46

Lecture+10+October+11 - Todays agenda Nobel Prize...

This preview shows document pages 1 - 15. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online