Ch. 5 1. As the price of a good increases, holding the consumer's income and the price of the other good constant, the budget line will A) shift inward toward the origin. B) shift outward away from the origin. C) rotate the budget line inward toward
ECON2101/ECON2210 Microeconomic Theory
Note on Production Function
Assume that a firm has the following production function:
, =
where and are non negative constant.
From a production function, we can obtain different information about
this firm:
(a) Th
Examples of Langrangian method
Q1:
MaxU = XY s . t . I =P X X + PY Y
(a) What is the equilibrium amount of consumption of X and Y?
(b) What is the price elasticity of demand and income elasticity of demand for X?
Q2:
Maurice has the following utility func
Intermediate Microeconomics
(a)
Derivative in calculus
The derivative is a measure of how a function changes as its
variable changes.
We use derivative to find the change of economic functions when
economic variable changes, e.g. how total output changes
Third tutorial handout: Revealed preference and production
1.
Consider an individual who has to frequently travel among different places due to his job. He only consumes two goods, X
and Y. In year 2012, he was working in town A.
(a)
In 2013, he moved fro
1 (a)
It is a pure substitution effect and the individual is better off with a higher utility
level.
And, as the price level in 2013 can allow the individual to consume the same
bundle as in 2012, but he chose another one, the new bundle is directly
revea
Exercise for the first tutorial:
Consider and individual, Antony, who is going to spend $40 on 2 goods, X and Y. Px
and Py are constant at $2 and $5 respectively.
Suppose right before lunar new year, a Lucky Bag package is offered, in which in
contains 2
profit maximization
Suppose a firm has a production function as follow:
y = L K
To simplified, assume that = 0.50.4 , = 0.3, = 0.6, therefore q = L0.3 K 0.6 .
It is very simple to find the profit-maximizing solution if total cost function is provided, bu
Write your aﬁswers on this side only. Q. No .
Wu [K ‘) : 2 L ’X'"; “J V’
gt. 1: PM + r ‘~ ' Raw/w
W'ﬁ‘ "My _,~/\L)7
P7" )7
3L - I 1 - - ‘ _ ’/
a J- Px - I".
.4 7RD _ 544‘
*1/1‘ \I,
. x’i‘ Write your answers on this side only.
1=
Non-graded exercise 2
1. A few sellers may behave as if they operate in a perfectly competitive market if the
market demand is:
A) highly inelastic.
B) very elastic.
C) unitary elastic.
D) composed of many small buyers.
2. Which of the following costs may
Problem set 1
Econ2101/Econ2210, Fall 2013
(Due October 7 10am, 2013)
1. Sam likes strong coffee, the stronger the better. But he cant distinguish small differences. Over the years, Mrs. Sam has discovered that if she changes the amount of coffee
by more
Theory of the Firm III: Cost Function
Microeconomic Theory (Econ2101 & Econ2210)
Dr. Bei Qin
School of Economics and Finance, University of Hong Kong
Spring, 2016
1 / 43
Cost : some concepts
Accounting cost Vs. economic cost
I
I
Accounting cost is the cos
Theory of the Firm I: Technology
Microeconomic Theory (Econ2101 & Econ2210)
Dr. Bei Qin
School of Economics and Finance, University of Hong Kong
Spring, 2016
1 / 30
The theory of the rm
The goal of rms?
I
Prot Maximizing
Prot=market value of products - co
Ch. 6 1. The production function represents A) the quantity of inputs necessary to produce a given level of output. B) the various recipes for producing a given level of output. C) the minimum amounts of labor and capital needed to produce a given le
Ch. 7 1. Opportunity cost for a firm is A) Costs that involve a direct monetary outlay B) The sum of the firm's implicit costs C) The total of explicit costs that have been incurred in the past D) The value of the next best alternative that is forgon
Ch. 8 1. The long-run total cost curve shows A) the various combinations of capital and labor that will produce different levels of output at the same cost. B) the various combinations of capital and labor that will produce the same level of output.
Ch. 9 1. Which of the following is not an assumption of a perfectly competitive market? A) Fragmented industry B) Differentiated product C) Perfect information D) Equal access to resources
2. Which of the following is not a characteristic of perfect
ECO303: Intermediate Microeconomic Theory (Balak, Spring 2008
Game Theory (ch 14) 1. Game theory refers to A) a plan for the actions that a player in a game will take under every conceivable circumstance that the player might face. B) a situation in
ECO303: Intermediate Microeconomic Theory (Balak, Spring 2008
Answer Key
1. D 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. A C C B D B D C A C A
Ch. 2 1. A relationship that shows the quantity of goods that consumers are willing to buy at different prices is the A) elasticity B) market demand curve C) market supply curve D) market equilibrium
2. The law of demand states : A) that price and q
Ch. 3 1. Consumer preferences: A) are fixed exogenously and unchanging in reality. B) indicate how a consumer would rank any two possible baskets of goods, taking into account her budget constraint. C) indicate how a consumer would rank any two possi
Ch. 4 1. The budget line A) represents the set of all baskets the consumer can afford. B) represents the set of all baskets the consumer can afford while spending all available income. C) represents the set of all baskets that give the consumer the s
Econ6001: Applied Econometrics, Fall 2015
Homework #1
Due date: 30th Sep. 2015; 6pm.
Do not copy and paste the answers from your classmates. Two identical homeworks
will be treated as cheating. Do not copy and paste the entire output of your statistical
p
Theory of the Firm II: Prot maximization I and Cost
Minimization
Microeconomic Theory (Econ2101 & Econ2210)
Dr. Bei Qin
School of Economics and Finance, University of Hong Kong
Spring, 2016
1 / 15
Prot maximization I
Given the input prices (w ) and output
Theory of the Consumer IV: Revealed Preference
Microeconomic Theory (Econ2101 & Econ2210)
Dr. Bei Qin
School of Economics and Finance, University of Hong Kong
Spring, 2016
1 / 30
Why Revealed Preference?
PreferencesUtility function + budget constraint =De
ECON2101/221OBE Micro Theory HW1 Answer
Problem Set 1 Answer
1. a.T b.T c.T d.F e.F f.T g.T h.T i.F j.T k.F |.F m.F n.F o.T
p.No q. No r.Yes
M
c. For Sam, MUl = 720; MU2 = 1200
For Samuel, MUl = 12; MU2 = 20
d. For Sam, MRS = -3/5
For Samuel, MRS =