PrinciplesofEconomics
S.GulatiFall2016
SolutionSet#1
1. (a)Seebelow.
(b) Pricewouldfalluntilthequantitydemandedandthequantitysuppliedwereequalatsomepricebelow$200,000.Inthe
diagramshownherethatwouldbeat$170,000.
(c) Quantity demanded would drop but the n
PrinciplesofEconomics
S.GulatiFall2016
SolutionSet#2
1. Theyarenotearningeconomicprofits;theyarenotconsideringopportunitycosts.Theopportunitycostofcapitalis10percent
of $50,000 annually, or $5,000. Because simple revenue minus cost yields an accounting pr
PrinciplesofEconomics
S.GulatiFall2016
SolutionSet#4
1.
a. Ahigherpricelevelwouldcauseamovementupalongtheshortrunaggregatesupplycurve.
b. An increase in what the price level is expected to be in the future would cause the shortrun aggregate supply
curvet
Eckert 1
Danielle Eckert
Professor Timmy
Economics 294
March 2, 2017
Fords Entrepreneurial Endeavors
Henry Ford (b.1863 d. 1947) was an entrepreneur from Michigan. As president of The
Ford Motor Company, Ford implanted and popularized truly revolutionary
1. What, if any, sort of government regulations exist in your industry? What led to the need
to create the regulation?
2. Have there been any antitrust cases in your industry? If so, please summarize the results
of the most prominent cases.
3. What sort o
Some of the Causes of Poverty:
- History. Many of the poorest nations in the world were former colonies, slaveexporting areas and territories from which resources had been systematically
extracted for the benefit of colonizing countries.
- War & political
The concept of Diminishing Marginal Utility applies to daily life because we most prize things
that we have the least of. The more you have of something, the less valuable it is to get one more
of that. The first unit of consumption for any product is typ
Bozena Tylka
Monopolistic Competition & Graphic Design Industry
1. Monopolistic Competition best characterizes my industry, which is
Graphic design industry. Each firm makes independent decisions about
price and output, based on its product, its market, a
A public good is a product that one individual can consume without reducing its
availability to another individual, and from which no one is excluded. A public good
is an item consumed by society as a whole and not necessarily by an individual
consumer. P
Graphic Designer
Since I was little girl I loved watching commercials on TV. It was weird, because all of my
friends hated it. Non of them liked commercials. Everyone just wanted to see cartoons. But I
didnt. I loved watching the colorful images and produ
Bozena Tylka
1. Companies in this industry plan, design and manage the production of visual
communication in order to convey specific messages or concepts, clarify complex
information or project visual identities. Graphic services do not entail actual pri
Describe the following market structures and provide examples of industries which exhibit the
characteristics of each structure. Explain how your examples characterize each market structure.:
1. Perfect Competition
2. Monopolistic Competition
3. Oligopoly
Conclusion including a discussion of how the study of economics has informed your
understanding of your chosen industry.
Before I took this class I thought that economics is all about money. Now I know that economics
is a combination of numbers and words,
Define the following terms in your own words.
Opportunity Cost
Trade-Off
Describe a recent situation in which you had to make decision based upon opportunity costs and tradeoffs. Include specific mention of the particular opportunity costs and trade-offs.
from scipy.misc import comb
import numpy as np
def qs5():
n = 15
r = 12
p = 0.5
px = [ comb(n,i)*p*i*(1-p)*(n-i) for i in range(r,n+1)]
print (np.sum(px)
def qs6():
n = 15
r = 14
p = 0.5
px = [comb(n,i)*p*i*(1-p)*(n-i) for i in range(r,n+1)]
px = np.sum(p
'
`. module: bfc.binomial
Option pricing
-'
import numpy as np
from scipy.misc import comb
import pfv
class Binomial:
'
Binomial model for option pricing
'
def _init_(self): # create default model
self.setup(100,3,1.07,0.01,100.,'european','call',0)
def d
'
homework 1
=
'
def calcPV(p,n,r):
return p*(1-r*(-n)/(1-1/r)
def calcFV(p,n,r):
return p*(r*n-1)/(r-1)
def calcDis(r,t):
return 1/r*t
'
Lottery payments
A major lottery advertises that it pays the winner $10 million. However this
prize money is paid at
'
Black Scholes Model
-'
from math import erf,sqrt,log,exp,pi
version = '1.0'
def calcN(x):
' return P(N(0,1)<x)
'
return (1.0 + erf(x/sqrt(2.0) / 2.0
def calcphi(x):
return exp(-x*2/2.)/sqrt(2*pi)
class BlackScholes:
' Black Scholes Model
'
def _init_(se
import bfc.BinomialTree as BT
import bfc.binomial as bino
if _name_ = "_main_":
n = 10
u = 1.1
d = 0.9
r0 = 0.05
a = 0.01
b = 1.01
rec = 0.2
F = 100
qu = 0.5
qd = 1-0.5
# set up short rate lattice
rlat = bino.setShortRateLattice(0.05,1.1,0.9,n)
# set up d
'
Present/Future Value
-'
import numpy as np
from operator import mul
import math
from IPython import embed
def calcPV(p,n,r):
' calculate the present value
:param p: future value
:param n: number of periods
:param r: interest for each periods
:returns: T
'
Binomial Tree structure
=
'
import numpy as np
class BinomialTree(object):
' Binomial Tree Structure
'
def _init_(self,n):
'
initialize the binomial tree
:param n: number of levels ( equals time step+1)
:returns: bt binomial tree
'
self.n = n
self.bt =
import numpy as np
# default rate of individual portfolio
ppd =
np.array([0.2,0.2,0.06,0.3,0.4,0.65,0.3,0.23,0.02,0.12,0.134,0.21,0.08,0.1,0.1,0
.02,0.3,0.015,0.2,0.03])
# probability with i credit default
n = len(ppd)
pd = np.zeros(n+1)
pd[0] = 1-ppd[0]