Advanced Microeconomics(ECH 32306)
Homework 3 - Solutions
Expected Utility Theory
1. On p.100 Jehle and Reny say that AXIOM G4 (Monotonicity) implies a1 an . Prove this.
Answer
We prove this by contradiction. Suppose a1 an , then a1 an and an a1 .
Further
EXERCISES
1. A PRACTICAL APPLICATION
PROBLEM 2.14 IN THE BOOK
Consider the problem of insuring an asset against theft. The value of the asset is
$D, the insurance cost is $I per year, and the probability of theft is p. List the
four outcomes in the set A
ECC5650 Microeconomic Theory
Topic 4: Topics in Consumer Theory
Primary Readings:
JR Chapter 4: 4.2, .4.3 & 4.4
DL Chapters 4, 5 & 11: 4.7, 5.8, 11.1-11.5
Additional References (at the end)
In this lecture, we will discuss a few special topics that have i
Econ 452, Assign 1, 2006
Economics 452
Assignment 1
Dr. L. Welling
January 13, 2006
Due: Tuesday, Jan. 24
Marks: 40 marks
Assignments are due at the beginning of class on the due date.
1. (5) Show that non-increasing relative risk aversion implies decreas
Chu Thanh Duc MDE10
Chapter 4. Consumer Theory II
Two essential tools of analysis in the modern treatment of consumer theory:
The Indirect Utility Function
The Expenditure Function
4.1 Indirect Utility and Expenditure
4.1.1 The Indirect Utility Function
Microeconoma Avanzada
Xavier Martinez-Giralt
CODE y Departament dEconomia
Universitat Aut` noma de Barcelona
o
Microeconoma Avanzada
Copyright c 2008 Xavier Martinez-Giralt.
Indice general
Pr logo
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XVII
1. Introducci n
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1
2. Teora del consumidor
2.1. El