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
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Which firm has the greater market power?
Suppose that there are two firms competing in the market for taxi services. Big Ben Taxis has the marginal cost MCB = $\$9$ per trip, and the fixed cost FCB = $\$3,000,000$, while Whitehall Taxis has the marginal cost MCB = $\$15$ per trip and the…
Badatit
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Elasticity of the function
Please find the elasticity of the function f(x) in x0:
$$f(x) = \frac{ax^2} {1+ x^2} $$ $$ x0=10$$
Could you please check is done correct ?
$$E_xf(x_0) = \frac{f'(x_0)·x_0} {f(x_0)} $$
$$f'(x)=\frac{2ax·(1+x^2)-2ax^2·2x} {(1+x^2)^2} = \frac{2ax}…
Michael
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The level of output to maximize profit
Could you please give me any advices how to solve this exercise? Would be grateful for any help:)
A firm's market demand function is $AR = 150-3x$ , and its total cost function is $TC= 0.1x^3 - 3x^2 + 30x$. Find the level of output to maximize…
Michael
- 33
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Number of firms in the market
Suppose market for corn is in long-run equilibrium. All suppliers face same cost curve $AC=300-q+0.02q^2$. The demand curve is given by: $D(P)=642,000-36P$. How many firms are there in the market ?
I'm getting no idea how to do it. Any help would be…
James Yang
- 79
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True market value
Given n elements, which are all traded against each other, is it possible to assign a single value to each one that reflects how much it's worth compared to all other elements?
i.e.: the Forex market, each currency is traded against each other, but…
Douglas
- 113
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Government's intervention - price and quantity after taxation
Given that demand for a good X is equal to $q_D=393-2p$ and market supply is $q_S=p/4-12$. Find equilibrium price and quantity, consumer and producer surplus and draw a diagram illustrating the situation. Given that:
a) $T=2q$, every single item…
mkropkowski
- 1,131
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What does this notation mean as a production function: f = min [t, 1.05k]
I'm attempting to work on an econ problem, but I'm having trouble understanding the notation that the production functions are given in to even begin to attempt to solve the problem.
This is what is given (I've changed the numbers/variables a bit,…
Mackenzie
- 11
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1 answer
Net profit involving Capital Recovery Factor
I'm having trouble understanding the last bit of the solution to this problem:
An industrial juicer costs \$45 000. It will be used for five years and
then sold to a remarketer for $25 000. If interest is 15 percent,
what net yearly savings are…
CivilSigma
- 1,047
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Time flow analysis and theoretical flow time
I'm working for my program for economy where I have an example I try to solve.
The flow rate is 0.15 units/min and
A - 1 server: flow time = 5, capacity = 0.2
B - 2 servers: flow time = 9, capacity = 0.22
C - 1 server: flow time = 6, capacity …
FrEaKmAn
- 111
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How to show that Roy's identity holds in the case of a monotonic increasing transformation?
I know that by Roy's identity, the Marshallian demand for a good (i) is $x^*_i = -\frac{V_i}{V_y}$, where $V(Y,P)$ is the indirect utility function, $V_i=\frac{\partial V}{\partial P_i}$, and $V_y=\frac{\partial V}{\partial Y} $.
I also know that a…
user7087
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2 answers
How to find the minimum variance portfolio?
I am doing some revision questions on my Portfolio Theory module, and have come across the following question:
Consider an investor who has constructed a risky portfolio from N securities. The investment opportunity set is described by the…
rwb
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Profit Function where total revenue is re-spent on production?
I'm trying to find a function that finds the net profit gain over multiple iterations. For example, if I produce a unit for 5 dollars , and can sell it for 8 dollars, I would have a net gain of 3 dollars per unit. However, let's say I have 50,000…
Rebecca
- 157
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1 answer
Calculating the Maximum Production Point for an Equation
I need some help on this equation:
$x\;$: Output Quantity
$CF\;$: Cost Function:
$CF(x)=5000+100x-\frac{x^2}{24}\;\leftrightarrow\;0\leq x\leq1600$
Now, I've already noticed that it sounds a litte bit strange, but, how can I calculate and find the…
Kerim Atasoy
- 859
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Finding the competitive equilibrium in an economy with two consumers and two commodities
I am unable to solve the following problem in general equilibrium.
Consider an economy with two consumers and two commodities X and Y. $X_i$ and $Y_i$ are the amounts of commodities present with the i-th consumer where $i=1$ or $i=2$.
The…
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1 answer
Utility function and preferences?
This might be more of an economical question, but perhaps some of you might've come across it before as math is involved;
A person P prefers bundle (x1,x2) over (y1,y2) if (x1*x2) > (y1*y2).
What is then the utility function? And how would I plot…
Daniel
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