ECON 230 Midterm 1 (/40)
Oct. 1st 2013
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. (1 point
each)
1) We can approximate the real return on an investment by subtracting the inflation rate from the
Exam
Name_
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
1) Since last year, the price of gold has risen from $1100 to $1420. What annual inflation rate would
leave the real price of gold unchanged
ECON 230D2 - 002
Mid-term 1
Name_
Student Number _
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
Scenario 12.3:
Suppose a stream is discovered whose water has remarkable healing powers. You decide t
Question 1 (20%)
Econ 230 D2-002 - Midterm 1
February 24th 2015
A monopolist faces a demand curve of Q = 50 p(Q) 2 and has constant marginal
costs of 20.
a) What is the profit maximizing level of output and
INTRODUCTORY MATHEMATICS LECTURE NOTES
Prof. Galiana
January 2014
I argue that our physical world not only is described by mathematics, but that it
is mathematics: a mathematical structure, to be precise, from Our Mathematical
Universe: My Q
Econ 230 Mid-term 2
VERSION 1
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
1) We manufacturer automobiles given the production function q = 5KL where q is the number of
autos assembled per eight-ho
Tentative Weekly Outline
ECON 230 D1
Fall 2014
Isabel Galiana
September 9, 2014
This weekly outline is tentative. I reserve the right to change the content and pace of the
class, as well as assignment submission and exam dates. Should changes be made to g
Tentative Weekly Outline
ECON 230 D2
Winter 2015
Isabel Galiana
December 30, 2014
This weekly outline is tentative. I reserve the right to change the content and pace of the
class, as well as assignment submission and exam dates. Should changes be made to
7
Continuous Games
So far, we have only looked at games with discrete strategy spaces. However,
in the real world, we often deal with continuous strategy spaces.
Example: Players 1 and 2 are bargaining over how to split one dollar.
Both players simultaneo
Tm
.omm can 89: $8 .0: mmon : mm was ad AD
mg 8% 808 pmou go: 806 x mm mcow mm C
.mum x98 um Am
.ohm 52$ 958 58 go: meow .3 mm wag mm E
9.3% :3 m #58 8 35335 mac: b5 mrs pom .5303 mm :m .333 : #m mummu
Am om m m: 895 :9, ag? we 03% mmx bEmEB mm .mosuc 32m
3.2
Alternative Model of Discounting
Consider hyperbolic discounting:
D(k) = 1 if k = 0
= k if k = 0
This upholds the idea in discounting that today is special; we will discount
dierently with respect to today than with respect to other days. Imagine a
pe
and so on. So the incumbent will collude in all 20 games. This result is
called the Chainstore Paradox. Note that this is not the only equilibrium,
but the only subgame perfect equilibrium. (This is similar to the Quiz on
Friday paradox. You know you will
1
1.1
Expected Utility Theory
Notation
Let A = cfw_a1 , ., an denote a nite set of outcomes that occur with certainty. For example, A = cfw_1, 1 can represent the outcomes win one
dollar and lose one dollar.
Let pi represent a probability assigned to out
A sequential move game
1st player
E
U
2nd player
(5,5)
A
(8,2)
R
(0,0)
In the example above, the subgame perfect equilibrium is (U, A if U ).
Another equilibrium, although it wouldnt be subgame perfect, would be
(E, R if U ). Here, the second player is co
of scrutiny: they didnt want to be seen by the rest of the community as being
greedy)
- interestingly, when a dominated bundle was available, the farmers were
less risk averse
- risk aversion doesnt aect technological choices; the problem was ambiguity av