Intermediate Microeconomics
Problem Set 3
Short Questions: (15+10+15+10=50)
1. Peregrine Pickle consumes (c1 , c2 ) and earns (m1 , m2 ) in periods 1 and 2
respectively. Suppose the interest rate is r
Chapter TwentySeven
Oligopoly
Oligopoly
A monopoly is an industry consisting a
single firm.
A duopoly is an industry consisting of two
firms.
An oligopoly is an industry consisting of a
few firms. Par
Chapter ThirtyOne
Exchange
Exchange
Two consumers, A and B.
Their endowments of goods 1 and 2 are
B
B B
A
A
A
(
( 1 , 2 ) and
1 , 2 ).
E.g. A ( 6,4 ) and B ( 2, 2).
The total quantities available
ar
Intermediate Microeconomics 20152016(2)
Problem Set 5
True/False (Indicate whether the statement is true or false. Write T if the statement is
true; otherwise write F if it is false.)
Answers: (1*16=
1. Nevilles passion is fine wine. When the prices of all other goods are
fixed at current levels, Nevilles demand function for highquality claret
is q=0.02m2p, where m is his income, p is the price
Intermediate Microeconomics
Problem Set 5
Problems (5*8+10=50)
1. Severin, the herbalist, is famous for his hepatica. His total cost function is
c(y) = y 2 + 10 for y > 0 and c(0) = 0. (That is, his c
Intermediate Microeconomics
Problem Set 2
Problems (15+10+10+15=50)
1. We begin again with Charlie of the apples and bananas. Recall that Charlies utility
function is U ( x A , x B ) x A x B . Suppose
Intermediate Microeconomics
Problem Set 4
Problems (4*15=60)
1. Suppose the production function is CobbDouglas and f ( x1 , x2 ) x11 / 2 x2 3 / 2 .
(a) Write an expression for the marginal product of
100
201647
1. 201, 2u(x1 , x2 ) = mincfw_x1 + 2x2 , 2x1 + x2
xi (p1 , p2 , m), i = 1, 2pi i m
2. 10
wCR
U = C R ,Rw, m
3. 15x(p, y) = 20 +
y
5p
x
y = 120p = 332
(a)
Intermediate Microeconomics 20162017 (2)
Midterm 0766 Answer
Multiple Choices (Identify the choice that best completes the statement or answers
the question. Only one choice is correct.)
Answers:
E
D
Intermediate Microeconomics 20162017 (2)
Midterm 1964 Answer
Multiple Choices (Identify the choice that best completes the statement or answers
the question. Only one choice is correct.)
Answers:
A
D
1
Large Sample Results for the Classical Regression Model
What happens when normality fails? Previous results hold approximately.
Consistency and Asymptotic normality will be the main requirements.
1
The Classical Multiple Regression Model
The model
y = xi1 1 + xi2 2 + + xiK K + i ,
i = 1, 2, ., n
y = x1 1 + x2 2 + + xK K +
1. Assumption 1
y = X +
where X is an n by K matrix, for the ith obse
1
OLS and Intrumental Variable Estimation
We will see that the most crucial point for the validity of OLS is Cov(, x) = Ex = 0.
Consider the OLS estimator for the model
Yi = 0 + 1 Xi + ui
=
1
if 2i
1
Multicollinearity, Regression Diagnostics and Misspecfication
In this section we introduction issues often encountered in regression analysis.
1.1
Multicollinearity and Regression Diagnostics
When t
Internationalization of C
hina
Outline
Inward Foreign Direct Investment
Outward Foreign Direct Investment
Export
The reason for Foreign Direct Investment

OLI TheoryDunning
Ownership advantage: s
Regional Business Envir
onment
Huan Yang
Shanghai University of Finance & Economics
School of Urban & Regional Science
Yang, Huan ( )
Associate Professor
Research Interests
International Entrepreneur
Answers to Problem Set 1
7.1 For any (x1 , x2 ) (0, ) (0, ), one always can find some point, say
(y1 , y2 ) (0, ) (0, ), in the neighborhood of (x1 , x2 ),such that y1 + y2 <
x1 + x2 ,which means (y1
1
9/11/2017
LECTURE 1: UTILITY MAXIMIZATION
Shanghai University of Finance and Economics
9/11/2017
Shanghai University of Finance and Economics
The Questions
How to describe consumer preference?
rev
2017/10/12
Shanghai University of Finance and Economics
LECTURE 2: CHOICE
1
2017/10/12
Shanghai University of Finance and Economics
The Questions
What will happen to demand if wealth changes?
What w
Economic Development
Economic Development
>10% GDP Growth each year for 20 years
>US $3 trillion in foreign exchange reserves
>45% saving rate
>700 million Internet user
>200 million middle class
Chapter Fifteen
Market Demand
From Individual to Market Demand
Functions
Think of an economy containing n
consumers, denoted by i = 1, ,n.
Consumer is ordinary demand function for
commodity j is
x*j i
Chapter Eight
Slutsky Equation
Effects of a Price Change
What happens when a commoditys price
decreases?
The change in relative prices makes the consumer want
to consume more of the cheaper good. The
Chapter Fourteen
Consumers Surplus
Monetary Measures of GainstoTrade
You can buy as much gasoline as you wish at
$1 per gallon once you enter the gasoline
market.
Q: What is the most you would pay to
Chapter Two
Budget Constraint
Consumption Choice Sets
A consumption choice set is the collection of
all consumption choices available to the
consumer.
What constrains consumption choice?
Budget, time
Chapter Ten
Intertemporal Choice
Intertemporal Choice
Persons often receive income in lumps; e.g.
monthly salary.
How is a lump of income spread over the
following month (saving now for
consumption la
Chapter Nine
Buying and Selling
Buying and Selling
Trade involves exchange  when something
is bought something else must be sold.
What will be bought? What will be sold?
Who will be a buyer? Who will
Chapter Three
Preferences
Rationality in Economics
Behavioral Postulate:
A decisionmaker always chooses its most
preferred alternative from its set of
available alternatives.
So to model choice we mus