For questions regarding the mathematical analysis of economic models and problems. This includes questions about the formulation or solution of models from microeconomics or macroeconomics.
Questions tagged [economics]
1602 questions
0
votes
1 answer
If equivalent variation is 0, can compensating variation be positive?
I'm solving a problem where wealth changes and I got that $EV=0$ and $CV=1$. This seems impossible to me; is it?
I'm given $e(p,u)=u/(p_1^{-1}+p_2^{-1})$.
I'm also given $(p_1^0,p_2^0,w^0)=(1,1,1), (p_1^1,p_2^1,w^1)=(1,1,2)$.
First, I used duality…
leecarvallo
- 151
0
votes
1 answer
PPF comparative advantage
Ive been looking all over the place for an answer to this question. I'm sure its simple and its driving me nuts.
The answer is b. but i dont know why.
$W10 = C10 \implies 1W = 1C$
$7W = 2C \implies 2/7C$
What am i missing?
user583753
- 131
0
votes
1 answer
Finding the Minimum Price | Supply, Demand Equation
Suppose that Kodak supplies its “Instamatic” film cameras according to the equation
Qs = -47,400 + 5,000*PK , where PK is the Kodak camera’s price.
Consumer demand for Kodak’s instamatic cameras is given by the equation
Qd = 33,600 - 100*PK + 2*PN -…
Koolakuf_DR
- 113
0
votes
2 answers
Solution to a problem of equilibrium
I am not sure how to write this problem. But here it goes.
I have a fixed amount of money. I want to distribute it in three different jackpots. Each one with a unique way of payout. Jackpot1 pays the same amount that you stake. Jackpot2 pays the…
Nikko
- 187
0
votes
2 answers
Intermediate Economics
This question refers to a market in which quantity demanded is given by $q = a - bp$ and quantity supplied by $q = c + dp$.
In this market, an increase in the parameter $a$ would:
a. increase quantity and decrease price.
b. decrease both price…
Joyce
- 1
0
votes
1 answer
Acidifying Water: Calculating the best bang-for-the-buck
I have water that is at a pH of 8.0. I want to acidify the water to a pH of 4.0.
I have two products that I can use to acidify the water:
Lemon Juice:
$12.47 * 13% tax = $14.09 per container
The volume of the container is 3.8 L
It takes 15 ml…
User1974
- 425
0
votes
1 answer
Consider the following Matrix, are the conditions satisfied?
I am trying to solve the following questions however i am having little lucky. I have searched online and consulted my textbook however neither are proving to be helpful. These types of questions always seem to come up in exams so i would be…
0
votes
1 answer
Pricing and Margin formula - Higher price with lower margin
I have a range of products from 20 to 20,000 dollars. I want to be able to have a high markup for lower priced products but a lower markup for competitive priced expensive products.
Forgetting tax for now...
EG - 5 item cost might get marked up to…
user2757902
- 103
0
votes
1 answer
Find the present value of installment payments of \$1000 now, \$2000 at the end of the first year
I was helping a comrade how to answer this engineering economics question. It goes like this:
Find the present value of installment payments of \$1000 now, \$2000 at the end of the first year, \$3000 at the end of second year, \$4000 at the end of…
fitzmerl duron
- 1,495
0
votes
1 answer
Unbiasedness and Consistency of OLS estimator : specific task
does anybody know how I can show that this estimator is typically biased (and consistent)
PS: It is just the standard OLS-estimator. However a constant Matrix $A$ has been added within $X'X$. And sorry for the $^{-1}$ - I did not figure out yet how…
0
votes
1 answer
Exact match and bond immunization
I am currently studying a risk management course, and there is one question from past year final exam about exact-match that I don't quite understand.
The problem is:
Consider an investor that needs to cover a liability of 1000 dollars in two years…
user311290
- 15
0
votes
1 answer
lending money to people for shorting on stock from math perspective
I am trying to understand why would someone lend you stocks despite commissions for you to short on stock exchange market.
If you borrow stocks from someone and price of stocks goes down, you get money, but he looses it.
before:
1_stock = 100…
Testing man
- 163
- 7
0
votes
1 answer
Is marginal product of x1 an increasing or decreasing function of x2?
Suppose that a firm has the production function $${f(x_1,x_2) = x_1^\frac{1}{2} + x_2^2}$$
I know that you have to find the marginal product for both $x_1$ and $x_2$ and those come out to be $x_1 = \frac{1}{2\sqrt x}$ and $x_2 = 2x_2$
Where do I go…
Kyle
- 65
0
votes
1 answer
Measuring effectiveness of production process
Say we have 2 factories $A$ and $B$ producing the same product.
for a certain period in question we know how much product each factory produced, call it $n_A,n_B$.
the cost of producing each product in the factories is known to us, we call it…
Ofek Ron
- 281
0
votes
0 answers
Mathematically optimal age to begin drawing Social Security retirement benefits as a function of expected life span?
So, for most of us Americans, our official retirement age is 66 and we get 100% of our retirement benefits. If we delay retirement, that benefit increases by 8% each year (up to age 70) and if we retire early that benefit decreases 6.667% each year…
