Economics 6100 Winter 1997
Answers to Assignment 1
1. Given that the total cost of a rms producing y units is y 3 8y 2 + 18y , the average and marginal
cost functions are
AC (y ) = y 2 8y + 18
M C (y ) = 3y 2 16y + 18
Since AC (y ) = 2y 8, the average cos
Economics 6100 Answers to Midterm
1. (a) Since the rms total cost function is
TC =
13
y 2y 2 + 9y
3
then its marginal cost function is
M C = y 2 4y + 9
The rms supply curve is the upwardsloping portion of its marginal cost curve where that
curve is above
Economics 6100 Winter 1992
answers to assignment 2
1. Note rst that player ones dominant strategy, if normal, is to nk in both the last and
the secondlast periods. The optimality of nking in the last period should be obvious. So too is
the optimality of n
Econ 6100 Winter 1991 Answers to Final Exam
1. Pretty straightforward. Solving the game backward, it can be seen that the governments
best strategy is to conscate the plant, regardless of what the rm has done. ( The government gets
50% of the gross prots
Econ 6100 Winter 1991
Answers to Assignment 2
1. Consider rst the decision of a stupid worker. If he chooses to go to college, the most his net payo
will be is 0, if the rm decides to hire him. On the other hand, the least that his payo could be if he dec
Economics 6100A.03Assignment 1
due : Feb. 5 1991
1. Suppose that two rms produce a homogeneous product. Demand for this product is linear. The rms
have identical constantreturnstoscale cost functions. Consider the basic Bertrand model here, modelled
as a
Econ 6100
Answers to Assignment 2
November 1993
1. It is most convenient to solve this problem in terms of the square roots of the various wage rates. So
let xi = wi , where wi is the wage the rm pays if the outcome is i.
The two constraints on the rms ch
Econ. 6100 : Answers to Assignment 1 : October 1993
1. First, there is no dominant strategy here for anyone. For example, if two of the other
voters voted for c, and two of the other voters voted for a, then c would be voter number 2s best
response. But i
Economics 6100.03 : Advanced Microeconomics
Answers to Final Exam
January 1993
1. There are two purestrategy Nash equilibria, (T, L) and (B, R). To nd any mixedstrategy
equilibria, let be the probability that player 1 plays T . Then player twos payo from
Econ 6100
:
Answers to Assignment 2
November 1992
1. The expected value of the outcome from action 1 is (0.5)(5) + (0.3)(10) + (0.2)(15) = 8.5.
The expected value of the outcome from action 2 is (0.2)(5) + (0.2)(10) + (0.6)(15) = 12. If the
choice of acti