EC 501: Problem Set 13, Solutions
1. (a) If Johnsville is not regulated, it will ignore the externality and simply
maximize its profit, using the monopoly solution. Now demand can be
P = 22
then M R = 22 Q.
Setting MR=MC to maxim
RISK AND RETURN
Business Risk and Financial Risk
Risk arises from both the operating and financing activities of a company.
Business Risk and Its Components
Business risk is the risk associated with operating earnings. Operating
earnings are risky because
Stock Exchange (JSE)
The JSE is currently ranked the 17th largest stock exchange in the world by market
capitalisation and the largest exchange in the African continent
The JSE was formed in 1887 during the first South African gold rush.
(a) By Price: A buy order with a higher price gets a higher
similarly, a sell order with a lower price gets a higher priority.
Consider the following buy orders:
1) 100 shares @ Rs. 35 at time 9:30 a.m.
2) 500 shares @ Rs.
P > 0.05 thus Null Hypothesis accepted, problem of Unit Root
Hence First Differencing is used
After 1st Differencing p < 0.05 thus Null Rejected, No Unit root Problem
2) AKZO Stock
As p > 0.05 Accept Null Hypothesis, Unit Root problem exists , so take 1 s
Microfinance is seen as an important tool for poverty alleviation and over the years, microfinance
institutions (MFIs) have placed themselves as fulfilling this developmental goal. The microfinance
movement was initiated by NABARD in collaboration wit
Garch Model : sum of coefficients of Arch and Garch term is less than 1, Garch term is dominant(more
dependent on previous volatility term)
As C4 is -ve and significant, Leverage effect is present
Volatility much depends on Garch term (previous
Two Issues I found in the paper were: Risk and discount rates and Diversification principles of
Risk and discount rates: Theoretically and Psychologically as risk increases one expects
higher returns, but Buffett doesnt seems agreeing with this
For easy notation, let us mark cells from 1 to 9 as follows :
Now, say Firm 1 chooses Low quantity, then best payoff for Firm 2 is 16 (as it is higher than 11
and 5 payoffs) , so mark tick on cell 4.
Now, say Firm 1 choose
EC 501: Problem Set 11, Solutions
1. (i) If Big Boy is a price leader, we must find the supply curve of the fringe
firms, which is the sum of their MC curves. For each firm, differentiating
the cost function, we get:
M C(q) = 2q + 5
so each firms supply c
EC 501: Problem Set 6, Solutions
1. (a) To test for returns to scale, suppose capital and labor inputs are fixed
at K0 , L0 and output is
q0 = 5K04 L04 .
Now lets change capital and labor inputs by a factor to K0 , L0 and
see what happens to output. O
[BUMN] Kementerian Badan Usaha Milik Negara Republik Indonesia. 2015.
Privatisasi BUMN. Jakarta (ID): BUMN.
Asropi. 2008. Menilik Kinerja Privatisasi: Perbandingan Malaysia dan Indonesia.
Urnal Administrator Borneo [Internet]. [diunduh 2015