Econ 604 Advanced Microeconomics
Davis
Spring 2006
2 March 2006
Reading.
Problems:
Chapter 6 (pp. 152-170) for today
To collect: Ch. 5. 5.6, 5.7, 5.8, 5.9
For next time: Ch. 6. 6.1, 6.3, 6.5
Test next time.
Lecture #7
REVIEW
E. Compensated Demand
1. Relat

Practice Problems Answers
1. Draw a typical budget and illustrate what happens when the price of either good changes
and/or income changes.
When the price of a good increases (decreases) the budget constraint will rotate in (out) along that
goods axis. Wh

Updated: 16 October 2007
ECON 501: MICROECONOMICS
Lecture 3
Topics to be covered:
a. Cobb-Douglas Utility Function
b. Ces Utility Function
c. Indirect Utility Function
d. Lumpsum Taxation
e. Ad valorem Taxation of one Good
f. Expenditure Minimization
0
EC

Eastern Mediterranean University
2014 2015 Fall Semester
Econ 601 - Advanced Microeconomics
Assignment 2
Question 1: Compare the Pareto Efficient Allocations in the following cases in
Edgeworth Boxes:
(a) Person A does not care at all about her consumptio

ECON 601
Spring Semester 2007
Due to March 15, @ 16:30 hrs
Problem Set 3
1. Suppose two individuals (Smith & Jones) each have 10 hours of labor to devote to
producing either ice cream (x) or chicken soup (y). Smiths utility function is given by
U s x .3 y

ECON 6912: Microeconomic Theory
Study Guide for Midterm 2
Major Topics:
1. Choice Under Uncertainty
a. Expected Value vs. Expected Utility
i. Determining Risk Behavior
1. Risk averse, loving, neutral
b. Insurance
i. Reservation price
Kahneman and Tversky

5.1
These goods are perfect substitutes. That is why it has a linear indifference
curve. 1 unit of X is equivalent to 3/8th unit of Y
You cannot use FOC under this case.
Entire money is spent on X if 3/8Px<Py (since X is cheaper) You can spent any
mount o

Eastern Mediterranean University
2010 Fall Semester
Econ 601 - Advanced Microeconomics
Assignment # 2
Due: 15 October, 2010
Question 1: Compare the Pareto Efficient Allocations in the following cases in
Edgeworth Boxes:
a) Person A does not care at all ab

Econ 604. Problem Set #1
KEY
1. Statistical evidence indicates that equations defining the demand and supply functions
of 1 pound bags of Starbucks Coffee at The Ukrops near VCU to be
Qd
Qs
=
=
is the price of a 1 pound bag of coffee
is the price of maple

Problem Set #10
Suggested Answers to Problems 11.1, 11.3, 11.5, 11.6 and 11.7
11.1 Digging clams by hand in Sunset Bay requires only labor input. The total number of
clams obtained per hour (q) is given by
q = 100L
where L is labor input per hour.
a. Grap

E604
Suggested Answers to Problem Set #2
(Problems 2.3, 2.5, 2.6, 2.9)
2.3. The height of a ball t seconds after it is thrown straight up is -1/2gt2 + 40t (where g is
the acceleration due to gravity)
a. If g=32 (as on the earth), when does the ball reach

E604 - Advanced Microeconomic Theory
Final Exam, 150 points.
Davis, Spring 2004
Answer all questions. Please take no more than 6 hours to complete this exam, and use
only your text as a reference. The test should be delivered to my (by mail, by hand or by

E604 Advanced Microeconomics
Spring 2005, Test #1
Davis
1. Consider the following utility functions
U(X,Y)
=
=
=
XY
X+Y
min (X,Y)
a. Develop the MRS for each utility specification.
b. For each function, draw illustrative indifference curves.
Y
Y
Y
X
U(X,Y

E604. Exam #1
Davis, Spring 2004.
Note: You may use your notes and your text on this examination. However, do not talk
with each other about this exam. Return this examination to me by 5 p.m. Saturday
March 13.
1) Consider the utility function U(X,Y)
= X2

Lecture 8: Cost Functions
Cost Minimization and the Cost Function
Because any profit maximizing firm wants to minimize the cost of producing any
given level of output, we start with the problem of minimizing a firms total cost. In terms of
our single prod