Problem Set #3
1 Basics
1. Demand functions. 2. Compensated Demand functions. 3. The Expenditure function. 4. The Indirect Utility function. 5. Using your expressions above and the Slutsky equation, develop mathematical expressions for the size of the inc
Problem Set #4
1 Production Functions - Basics
1. For the following production functions, nd expressions for the Marginal Rate of Technical Substitution and sketch a typical Isoquant. (a) x = L K 1 (b) x = ln L + (1 ) ln K (d) x = Min [L, (1 )K ] (c) x =
Problem Set #6 - General Equilibrium Consider an economy in which there is one firm, one good produced, and one consumer. However, in contrast to the model we did in class, suppose that the consumer has dislikes working. The consumers utility from consump
Problem set #5 Competitive Equilibrium Microeconomics 701 A beginning market equilibrium problem: Firms have production function x = A kl . Consumers have demand function x = I / p . In the short run, there are m firms, each with one unit of capital. The
Econ 701 Microeconomic Theory - Problem Set #4 Production and Cost functions Consider the following production functions (all greek letters are parameters): a. q = k l 1 b. q = ln(k ) + (1 ) ln(l ) c. q = min[k , l ] d. q = ( k ) l 1 2. For each of the ab
Econ 701 Microeconomic Theory - Problem Set #3 Income and substitution effects, expenditure functions and elasticities Consider the utility function U = x 2 y 2 . 1. For the utility function, find: a. Demand functions b. Compensated demand functions c. Th
Problem Set #2 - Answer Key 1. The Lagrangian is: O L:=x^2*y^3+lambda*(I-px*x-py*y); L := x2 y3 C I K px x K py y We take the two derivatives to get: O dLdx:=diff(L,x); dLdx := 2 x y3 K px O dLdy:=diff(L,y); dLdy := 3 x2 y2 K py O dLdlam:=diff(L,lambda);
Econ 701 Microeconomic Theory Problem Set #2 Consumer Utility and Demand Functions Review Problems Notes: This problem set is designed to give you a little bit of practice in computing derivatives and solving some simple optimization problems. For referen
Problem Set #3 Answer Key
1 Basics
Consider the utility function u = x y 1 . Answer: For this utility function, nd: 1. Demand functions. Set up the Lagrangian: L = x y 1 + (I px x py y ) This gives the rst order conditions: x1 y 1 px = 0 (1 )x y py = 0 I
Problem Set #2
1 Basics
For the rst ve utility functions below, nd the demand functions. 1. u(x, y ) = x2 y 3 2. u(x, y ) = (x 2)(y 3) 3. u(x, y ) = 2 ln x + 3 ln y 4. u(x, y ) = x 3 y 5. u(x, y ) = x 2 y 2 6. Find the indirect utility function associated
Problem Set #1 Answer Key
This problem set is designed to give you a little bit of practice in computing derivatives and solving some simple optimization problems. The focus of much of the problem set is on the power rule of dierentiation, use of the (nat
Problem Set #1
This problem set is designed to give you a little bit of practice in computing derivatives and solving some simple optimization problems. The focus of much of the problem set is on the power rule of dierentiation, use of the (natural) logar
Midterm Exam Eco 701 - Fall 2009 Practice
General Instructions: Please answer all of the questions in your blue book. You have the entire class time (approximately 2 hours) to complete the exam. Be sure to mark your answers clearly and show all work. If y
Midterm Exam Eco 701 - Fall 2009 Take Home Question
General Instructions: Please answer the following questions thoroughly and neatly on a nice sheet of paper. Specic instructions: 1. You are to work on this problem independently. Do not work on this with
Midterm Exam Eco 701 - Fall 2009 Take Home Question
General Instructions: Please answer the following questions thoroughly and neatly on a nice sheet of paper. Specic instructions: 1. You are to work on this problem independently. Do not work on this with
Midterm Exam Eco 701 - Fall 2009 Practice
General Instructions: Please answer all of the questions in your blue book. You have the entire class time (approximately 2 hours) to complete the exam. Be sure to mark your answers clearly and show all work. If y
Econ 701 Microeconomics Mid term exam Matthew Baker General Instructions: Please answer all of the following questions in your blue book. You have the entire class time (approximately 2 hours) to complete the exam. Be sure to mark your answers clearly and
Bond Market
Description of the structure in a historical and global context
Mechanism of the structure (How it works) globally
The role in and the impact of the structure on the economy both in the US and globally
Regulations affecting this structure