# Questions tagged [microeconomics]

Microeconomics is a branch of economics that studies the market behavior of individual actors (usually firms and consumers) and the aggregation of their actions in different institutional frameworks (usually the market).

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### How to distinguish if production costs changes the elasticity of the supply or shifts it?

I have specific doubts about how a factor affects supply elasticity and how it shifts the supply curve. In many cases, the literature shows that some factors affect supply in both ways. For example, a ...
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### Production efficiency under monopoly

Sorry, I forgot to mention that in this case, the demand curve is above the LAC at the point where MR = MC. In other words, the price is set higher than the long-run average cost. I am trying to wrap ...
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### Economic and Statistical Significance Of Coefficient

I want to know If I am comprehending these terms correctly Summarizing the difference between economic and statistical significance of coefficients (Describing the terms, process of assessing each ...
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### Unique competitive equilibrium in an exchange economy

I was working on the following excercise: In an exchange economy $\varepsilon$ with two goods and strictly monotone, continous and strict concave utility functions, suppose all demand functions are ...
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### Neutral good and quasi linear

if my good y is neutral and x is essential. My indifference curves look like vertical, but I want to ask that How does my utility function look like and can I say that this is quasi linear because mrs ...
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### Violation of the transitivity axiom [duplicate]

I'm struggling to think of a way to violate the transitivity axiom. I was thinking about the following scenario: Let's say that you're voting on three different choices, A, B and C. If you pit A vs. B,...
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### Binary relation on the set $X = \{v, w, x, y , z\}$ that is asymmetric and transitive but not negatively transitive

So I am trying to find a binary relation on the set $X = \{v, w, x, y, z\}$ that is asymmetric and transitive but not negatively transitive, and is quite tricky. Will $R = (v, w)$ be asymmetric and ...
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### Demand curve:log Quantity, logprice,logprice of N substitute goods,log income, need something else?

Imagine the following situation: a seller of a company has the price and quantity sold for a certain good, that seller can simply make a regression like: ln(Quantity) = ln(Price) ~ ln(price of ...
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### What is the relationship between Marshallian demand and Two-Stage Least Squares Estimation Procedure

I was reading Varian, and he gives an example of how to find the quantities demanded using a CobbDouglas utility function with observable data, and a question arose: what is the relationship between ...
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### law of diminishing marginal returns and regression on the factors of production

Does it make any sense to create an equation with Profit ~ Production factor1 + Production factor1 ^ 2 + Production factor2 + Production factor2 ^ 2 to explain how much the increase of 1 in a company'...
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### Quasi-linear utility. Deriving demand

I was trying to derive a general demand for the good $x$ for this quasi-linear function $u(x,y) = y + 2\sqrt{x}$ subject to standard budget constraint $p_x x + p_y y \leq M$ Using Kuhn-Tucker ...
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### Perfectly Inelastic Supply curve and Producer margin [duplicate]

If the supply curve is perfectly inelastic then it is vertical as no matter what the price is supply will be same. Producer surplus is area below equilibrium price and above supply curve. so in case ...
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### Marginal rate of substitution interpretation

I am trying to interpret the marginal rate of substitution stidied in an article. The article in question is Burbidge, J. B., Robb, A. L., 1980. Pensions and retirement behaviour. The Canadian Journal ...
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### How do I analyze an economic model with no variable costs?

I'm somewhat new to economics, and I'm working on a strange model: It involves webmasters of web pages acting as producers of clicks that can be consumed by other webmasters, who pay per click. I'm ...
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### Why don't we give social security in such a way that previous optimal bundle is once agin the optimal budle?

In this the budget line has shifted inwards due to increase in the price of goods. And then we provide social security such that the past optimal bundle becomes affordable but is not optimal. So why ...
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### Absolute and Comparative Advantage Help

I started studying microeconomics and I am having trouble figuring our how can I find the "?" values in this table? If someone could help me I would be really grateful. ...
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### Estimating multi-output production technologies

For a given firm, is it ever appropriate to estimate an independent production function for each output? For example, a university produces journal articles $A$ and services a number of students $S$ ...
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### How do I figure out whether the ICs are convex or concave?

Question: Randy Ratpack hates studying both economics and history. The more time he spends studying either subject, the less happy he is. But Randy has strictly convex preferences. (a) Sketch an ...
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### Capital in terms of labor

I have a question that asks to find $\frac{\partial K}{\partial L}$ from $Q=cL^aK^b$, when $Q$ and $c$ are constants. It lists 4 answer choices but Iām just not sure how to approach it. Implicit ...
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### Auction Makrets and delearship markets

The largest difference is that the NYSE is an auction market and the Nasdaq is a dealer market. In the former, the highest bid for a stock is matched with the lowest asking price. In the latter, ...
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The mean preserving spread is defined as follows: Consider two lotteries g and h. Let $x_g$ und $x_h$ denote the corresponding random variables. Then h is a mean preserving spread (MPS) of g, if: $... 0answers 41 views ### Grab the dollar Bayesian game$\epsilon_i$is distributed uniformly on$[-\phi, \phi] $where$\phi>1$. My working so far is as follows: $$\mathbb{E}U_1[I]=1+\epsilon_1\\\mathbb{E}U[N]=0\\$$ Therefore, the optimal strategy for ... 0answers 60 views ### Farmer and owner Bayesian game A farmer has talent$\theta$uniformly distributed on$[0,1]$. His payoff from farming his land is$\theta.$Before setting up his farm, he chooses some$w\geq0$, which a plant owner can either accept ... 0answers 24 views ### What would we say on the utility of risk and its consequences? Anything has its risks and anything has its utility or desutility. The risk aversion causes a looking for safer alternatives in the market which maximizes utility in a trading off between risk and ... 0answers 23 views ### Is there a case where the demand of a consumer with monotonic preferences, does not fall on the budget line? In other words, apart from (weakly) monotonic preferences are there any other necessary conditions for Walras's Law? Does monotonicity imply completeness and transitivity? 1answer 143 views ### How to find the Utility Possibility Frontier when there are Perfect Substitutes? I am trying to derive the Utility Possibility Frontier (UPF) when both utility functions display perfect substitutes (in an Edgeworth economy with to consumers and two goods). The specific problem:$...
If Bernice (whose utility function is min {x; y} where x is her consumption of earrings and y is money left for other stuff ) had an income of \$12 and was paying a price of \$3 for earrings when the ...