Chapter Nineteen
Technology
Technology
A
technology is a process by which
inputs are converted to an output.
Examples?
Inputs and Outputs
Factors
of Production:
Land
Labor
Capital: physical, financial, human
Raw material
Entrepreneurship
Inputs an

Chapter Nineteen
Technology
Technology
A
technology is a process by which
inputs are converted to an output.
Examples?
Inputs and Outputs
Factors
of Production:
Land
Labor
Capital: physical, financial, human
Raw material
Entrepreneurship
Inputs an

Utility Maximization Problem:
Deriving Demand Functions
When
x1* > 0 and x2* > 0
and indifference curves are smooth
with diminishing MRS, the demand
functions are obtained by solving:
(a)
p1x1* + p2x2* = m
(b) the slopes of the budget constraint,
-p1/p

ECN 2001
MICROECONOMICS I
SLUTSKY EQUATION
Class Discussion 6 (Ch. 7) - Answer Key
TRUE-FALSE
Two people are flying in a hot air balloon and they realize they are
lost. They see a man on the ground, so they yell to him:
-Please help us sir. We are lost. W

Handout: Intermediate Microeconomics
November 2, 2016
Q1: The production function for widgets is:
Y K 0.5 L0.5
where Y is the total output per time period, K is the quantity of capital employed per time
period, and L is the quantity of labor employed per

Home Assignment 1: Due on 17th October 2016 at the beginning time of the class
Intermediate Microeconomics
Q1:
A consumers utility function is:
Dr. Heman Lohano
(1 , 2 ) = 1 2
where 1 and 2 denote the consumption of composite good in period 1 and period 2

Review from Chapter Two
x2
m /p2
Budget Constraint for Two
Commodities
Budget constraint is
p1x1 + p2x2 = m
x2 = -(p1/p2)x1 + m/p2
so slope is -p1/p2
Budget
Set
m /p1
x1
x2
m /p2
Budget Constraint for Two
Commodities
Slope of linear curve can also be
comp

Handout 1
Dr. Heman Lohano
Q1) A consumer faces the budget line represented by the equation Y =150 X. The price of good Y is
Rs.10.
a. What is the consumers income?
b. Find the price of good X?
c. Draw the budget line showing the value of both intercepts?

Key of 1st Term Examination
Intermediate Microeconomics
Dr. Heman Lohano
Q1:
(2 marks)
A consumer faces the budget line represented by the equation Y = 100 2X. The price of
good X is Rs.10.
(a) Find the consumers income. (1 mark)
(b) Find the price of goo

Handout: Intermediate Microeconomics
October 14, 2016
Dr. Heman Lohano
Q1:
The demand function for a product is given by: QD = 160 2P, where QD is quantity demanded
and P is the price. What is the price elasticity of demand at P = 30?
A) 0.33
B) 0.45
*C)

Intermediate Microeconomics
Handout
Dr. Heman Lohano
October 5, 2016
Q:
A consumer receives utility from consuming good X and good Y as given by the utility
function:
U (X, Y) = X Y
Price of good X is denoted by Px (rupees per unit), price of good Y is de

Handout 6: Intermediate Microeconomics
Suppose there are two inputs (labor and capital) and one output.
Profit = TR TC
= p.y wL rK
Q:
A firm producing widgets has the following production function:
y K 0.5 L0.5
where y is the total output per time period

Handout: Intermediate Microeconomics
October 14, 2016
Dr. Heman Lohano
Q1:
The demand function for a product is given by: QD = 160 2P, where QD is quantity demanded
and P is the price. What is the price elasticity of demand at P = 30?
A) 0.33
B) 0.45
C) 0

Solutions of Mathematical Economics Workouts
for Intermediate Microeconomics
October 28, 2014
1
Exercise 1.
Rb
Definition of Definite integral: a f (x) dx = F (b) F (a), where F (x) + C is
some function for which following is true: F 0 (x) = f (x); Defini

Handout: Intermediate Microeconomics
Refer to Varian book (Section 5.6: Choosing Taxes)
Q:
A consumer receives utility from consuming good X and good Y as given by the utility
function:
U ( X , Y ) XY
Price of good X is denoted by Px (rupees per unit), pr

Institute of Business Administration, Karachi
ECO201: Intermediate Microeconomics
Fall Semester 2016
Course Instructor: Dr. Heman Das Lohano
Email: hlohano@iba.edu.pk
Office hours: Monday & Wednesday 1:00 2:00 pm (or by appointment)
Course Description: Th

Chapter Fifteen
Market Demand
From Individual to Market Demand Functions
Consumers
ordinary demand
function for a commodity is
= ( , ,)
A market contains n consumers,
denoted by i = 1, ,n.
When all consumers are price-takers,
the market demand functio

Intermediate Microeconomics
Handout 2
Dr. Heman Lohano
September 5, 2016
Q1:
A consumer receives utility from consuming good X and good Y as given by the utility
function:
U (X, Y) = X Y
The price of good X is Px = 1 rupee per unit. The price of good Y is

Key of Quiz 1: Intermediate Microeconomics
Q1. If Sara spends all of her income on apples and oranges, she can afford 9 apples and 10
oranges per week. She could also use her entire budget to buy 3 apples and 12 oranges per
week. The price of apples is 10

Key of Quiz 1: Intermediate Microeconomics
Q1. If Sara spends all of her income on apples and oranges, she can afford 9 apples and 10
oranges per week. She could also use her entire budget to buy 3 apples and 12 oranges per
week. The price of apples is 5

Today.
Couple of more induction proofs.
Stable Marriage. Strengthening: need to.
Theorem: For all n 21,2721 712 g 2. (8, 2):?21 715.)
Base: P(1). 132.
Ind Step: 2L1 [la 3 2.
k+1 1
Zi=1 ,-2
k
=2i=1%+m-
1
52+m
Uhoh?
Hmmm. It better be that any sum is strict

Wasons experiment:1
Suppose we have four cards on a table:
> tst about Alice, 2nd about Bob, 3rd Charlie, 4th Donna.
> Card contains person's destination on one side,
and mode of travel.
> Consider the theory:
It a person travels to Chicago, he/she flies.

Lecture 5: Graphs.
Graphs!
Euler
Definitions: model.
Fact!
Euler Againll
Planar graphs.
Euler Again! Konigsberg bridges problem.
Can you make a tour visiting each bridge exactly once?
"Konigsberg bridges" by Bogdan Giusca - License.
Can Y6 draw a tour i

Today
Review for Midterm. First there was logic.
A statement is a true or false.
Statements?
3 = 4 1 ? Statement!
3 = 5 ? Statement!
3 ? Not a statement!
n = 3 ? Not a statement.but a predicate.
Predicate: Statement with free variable(s).
Example: x = 3 G