Questions tagged [self-study]

Questions about self-studying economics, including curriculum design, study strategies, resources, etc.

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Applying dynamic programming to constrained utility

I am trying to solve problem that looks like this; there is utility function that takes $x$ and $y$ as inputs, $x$ is produced by production function that depends on labor $l+y=1$. $x, y$ depend on $t$...
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What happens if the volatility in the equity market increases? Does interest rates move up or down?

I think both can happen and here is my reasoning. Please correct me if I am wrong. During times of increased volatility in the equity market, investors adopt a more risk-averse approach and gravitate ...
CountDOOKU's user avatar
1 vote
1 answer
96 views

Graduate level economics lecture videos?

I have a background in economics(undergrad + plus some research) I want to try to teach myself graduate level economics. Are there any good lecturers who cover this topic online(youtube or another ...
Quantumidiot's user avatar
0 votes
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53 views

Utility Possibility Set and Utility Possibility Frontier

Consider an Exchange economy with two individuals $a$ and $b$ and two goods $1$ and $2$. Denote consumption of good $j$ by individual $i$ as $x_{ij}$ for $i\in\{a,b\}$ and $j\in\{1,2\}$ The utility ...
mynameparv's user avatar
3 votes
0 answers
77 views

Open Economy IS-LM with Perfect Capital Immobility

As a part of self-study for entrance exams I was trying to solve the following problem: The problem with this question is that I feel like the equation for $TB$ is incorrect, because we are given ...
mynameparv's user avatar
2 votes
0 answers
74 views

Regression OLS estimator with $x_t=1/t$

I found some questions in a book and wanted to train for my upcoming exam (expect to see some more posts from me idk), anyhow this is the question. To solve point A I rewrote the whole equation in ...
Blipo's user avatar
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2 answers
68 views

Why there is no study on the forecasting methods for the exchange rates of CBDCs? What do you think?

What do you think about the predictiion/forecasting the exchange rate of CBDCs? (CBDC= CENTRAL BANK DIGITAL CURRENCY) I cannot find any paper on this issue in the literature. But, there are some ...
studentp's user avatar
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Eurodollar exercise

I'm trying to solve an exercise with Eurodollar and deliverable bonds. This is the text in matlab Basically there are two Bonds A and B and I need to find a few things about them. I use the formula ...
Blipo's user avatar
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3 answers
183 views

FOC greater than 0

I couldn't get my head around this part. Basically, I have to prove that a consumer has to hold a positive amount of assets, i.e. $x > 0$. A hint suggested to find take the FOC, and then set $x = 0$...
kyrie3's user avatar
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1 answer
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Probability for Economics

I need to learn ASAP on the list of topics: Multivariate Distribution, discrete and continuous random variables; integration and expectation; law of large numbers and central limit theorem, confidence ...
Big Smile's user avatar
3 votes
1 answer
73 views

Challenging question in microeconomics - local nonsatiation

I'm studying advanced micro from the Mas-Colell book (exercise 16.C.1) I was wondering if anyone can help me to solve the following exercise. I have no idea how to deal with it Show that if a ...
Maximilian's user avatar
1 vote
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Expected payoff of bidder and expected revenue for seller?

There are 2 bidders in an auction that has a style as follows. There is a price clock that continuously rises starting from zero. The bidders gradually drop out of the auction and the clock stops as ...
kyrie3's user avatar
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1 answer
48 views

How to find the share price with respect to the type of share?

As someone coming from a mathematical background who has started reading into some basic finance, there are a few concepts that I am struggling to understand and would be grateful if I could check to ...
FD_bfa's user avatar
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Every Nash equilibrium is Subgame perfect Nash equilibrium

Every Nash equilibrium is Subgame perfect Nash equilibrium. This statement is wrong. I show this by an counter example. Is this example enough and good to disprove this statements? Please share your ...
studentp's user avatar
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2 votes
1 answer
104 views

Risk dominance in NE

I am trying to wrap my head around the idea of risk dominance but I am not confident whether or not what I am thinking is correct. A B A 80, 80 80, 0 B 0, 80 100, 00 The solution says that the ...
kyrie3's user avatar
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1 vote
2 answers
415 views

Effect of shock to technology level in the Ramsey model

My instructor said that the answer I wrote below is not correct without any explanation. But I dont know why. I need to learn its correct answer. Please share your ideas with me. I asked the same ...
studentp's user avatar
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2 votes
1 answer
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subvalue additivity

How would you show that whenever 𝑉 additively represents an agent’s preferences, then so does any function 𝑉′ that differs from 𝑉 only by the choice of zero and unit. If we assume that 𝑉 ...
jayil's user avatar
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Difference between complete market and incomplete market in terms of welfare loss

What do you think about the relative welfare of an incomplete market and complete market in the recursive competitive economy with both physical and human capital accumulation — I think that in the ...
studentp's user avatar
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2 votes
0 answers
85 views

Recursive economy with uncertainty in two islands

There are two economies A and B with infinitely many identical households. Since there are infinitely many identical households in each economy, they are all price taker. Maeasure of agents in A and B ...
studentp's user avatar
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48 views

Show that the order of deletion doesn’t matter for the set of strategies surviving iterated elimination of strictly dominated strategies

Question from M.W.G-8B4 Show that the order of deletion doesn’t matter for the set of strategies surviving iterated elimination of strictly dominated strategies. My proof attempt I assume $G_n$ the ...
studentp's user avatar
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2 votes
1 answer
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Stackelberg equilibrium with n+1 firms

There are (n+1) firms (Firm 0, Firm 1, ..., Firm n) in a market for a good where $n \ge 2$. The price in the market is given by the inverse demand equation $P = 100 - \sum_{i=0}^n q_i$, where $\sum_{i=...
ThePooh's user avatar
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2 votes
2 answers
324 views

Finding Pareto optimal allocations and Walrasian equilibrium allocations in the case of 3 goods

We have 3 people and 3 goods $$U_A(x,y,z)=x_Ay_Az_A^2$$ $$U_B(x,y,z)=x_B^2y_Bz_B$$ $$U_C(x,y,z)=x_Cy_C^2z_C$$ Endowments are $W_A= (1,1,1)$ $W_B= (2,1,3)$ $W_C= (1,5,1)$ I am confused due to the ...
studentp's user avatar
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0 answers
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Finding cost function

The production function is as follows $$f(z)=(z_1+z_2)(z_3+z_4)$$ Find the cost function? What I did is as follows. But I am not sure about my solution. How do you solve it? *duplicated question
studentp's user avatar
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1 vote
1 answer
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Proof on quasi-concavity and concavity

Let $f_1,…, f_m$ be quasiconcave functions on a convex subset X on $IR^n$. Let $p_1,…, p_m$ be nonnegative real numbers. Then, how can I show that $\sum_{i=1}^mp_if_i $ is also quasi concave function? ...
studentp's user avatar
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2 answers
65 views

$min\{f(x,y),g(x,y)\}$ is also quasiconcave for $f(x,y)$ and $g(x,y)$ quasiconcave functions

Assume that $f(x,y)$ and $g(x,y)$ are quasiconcave functions, then $min\{f(x,y),g(x,y)\}$ is also quasiconcave. What I did Assume that $\{(u,v), (z,t)\}$ are domain of f and g for $0<\theta<1$ $...
studentp's user avatar
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0 votes
1 answer
122 views

Walrasian equilibrium with quasi linear function

There is a two-person exchange economy Each agent has the following utility $u_i(x_i,y_i)=v(x_i)+y_i$ for agent $i=\{A,B\}$ Assume that $v$ is strictly concave and increasing function that has a ...
studentp's user avatar
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0 votes
0 answers
27 views

Temporary shock in VAR model

I hava the following bivariate VAR system $$z_t=a_{11} z_{t-1} + a_{12} v_{t-1} + b_{11} z_{t-2} + b_{12} v_{t-2}+u_{zt}$$ $$v_t=\gamma z_t + a_{21} z_{t-1} + a_{22} v_{t-1} + b_{21} z_{t-2} + b_{22} ...
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1 vote
0 answers
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Deriving ADF unit root test form for the time series with quadratic deterministic trend

I have the following time series process $y_t $ $$\Delta y_t = \delta + \gamma t + \epsilon_t$$ where $e_t$ is white noise process with the variance of $\sigma^2$. I guess that whereas $\Delta y_t$ is ...
studentp's user avatar
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0 answers
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Application of Maximum Likelihood estimation (MLE) to the Generalized Least Square (GLS) model

I have the following regression $$y = X\beta +u$$ where $y$ and $u$ are $(n\times 1)$ and $X$ is a fixed $(n \times k)$ matrix with full column rank and $\beta$ is an unknown $(k\times 1)$ vector of ...
studentp's user avatar
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0 votes
2 answers
183 views

Strict preference relation implies weak preference relation

Condition A: Given x, y in X such that $yRx$ then it follows that $\lambda y +(1-\lambda)xRx$ for all $0< \lambda<1$ Condition B: Given x, y in X such that $yPx$ then it follows that $\lambda y +...
studentp's user avatar
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1 vote
1 answer
194 views

Question on the conditions for the existence of a Walrasian equilibrium

I have a production Economy with two consumers and one producer. Consumers have a consumption set in $R^2_+$ Y is production possibility set and $$Y= \{y | max (2y_1+ y_2, y_1+2y_2)\le 0\}$$. ...
studentp's user avatar
  • 120
1 vote
1 answer
391 views

Find the set of Pareto efficient allocations

There is an exchange economy with two people and two goods. Utility functions are $u_A(x_A, y_A)=\max\{x_A, y_A\}$ $u_B(x_B, y_B)=\max\{x_B, y_B\}$ Endowments are $w_A(1,\alpha)$ and $w_B(1,\alpha)$ ...
studentp's user avatar
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0 votes
0 answers
68 views

For each Pareto efficient allocation, suggest how we might change the endowments so that the Pareto efficient allocation is a walrasian equilibrium

I have a two-person exchange economy Each agent has the following utility $u_i(x_i,y_i)=v(x_i)+y_i$ for agent $i=\{A,B\}$ Assume that $v$ is strictly concave and increasing function that has a ...
ThePooh's user avatar
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1 vote
0 answers
36 views

Find the utility of each agent whenever the social welfare is maximized

Question: Suppose that the utility possibilities curve of 2 people economy is given by the equation $u_1^2 + Au_2^2=20$ where $A\in R_+$ and the social welfare function of the economy is $W(u_1,u_2)=...
studentp's user avatar
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1 vote
0 answers
139 views

Please check for payoffs which I calculated in the incomplete and imperfect game

Taxpayers may either have a high income or low income, and they may be either opportunistic or honest. The tax collector cannot observe any of these characteristics, but after receiving a report from ...
studentp's user avatar
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1 vote
0 answers
124 views

All-pay auction question

Two players take part in the following auction for a £1000 prize. The two players submit bids simultaneously, and the higher bid wins the prize (if bids are identical each gets £500). Both the winner ...
studentp's user avatar
  • 120
1 vote
1 answer
266 views

MWG 8.B.7 - Any strictly dominant strategy must be a pure strategy

This question from MWG 8.B.7 Any strictly dominant strategy must be a pure strategy. How can I show this? My explanation is as follows: Suppose we have a strictly dominant strategy, $\sigma_i$ . ...
studentp's user avatar
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0 votes
0 answers
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Find SPNE in the two stage game

Consider a firm in a two period world. The firm operates as a monopolist in the first period. In the second period, another firm will enter and the two firms will act as Cournot duopolists (i.e., in ...
studentp's user avatar
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1 vote
2 answers
624 views

Finding the Pareto efficient allocations

Consider a 2 person 2 good economy where there is a private good $x$ and a public good $y$. Agent 1 has an endowment of 10 units of the private good and Agent 2 has an endowment of 20 units of the ...
studentp's user avatar
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3 votes
1 answer
264 views

Write down budget constraint

Assume an infinite horizon representative agent economy with the following consumer preferences $u(c_t)$ The production technology of this economy uses capital and land, which is fixed amount in ...
studentp's user avatar
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0 answers
18 views

Real or monetary values? In the context of Classic model

I am studying the classing model. And I have a basic question what are the units of the following variables( monetary or real?) Inflation rate ($\pi$), wage (w), Labor supply N, consumption C, ...
studentp's user avatar
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0 votes
1 answer
115 views

Endogenous growth model with externalities

I have a following model of endogenous growth where each firm has the following technology; $$y_t=AK_t^{1-\alpha} k_t^{\alpha} n_t^{1-\alpha}$$ The production function above defines an externality. I ...
studentp's user avatar
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2 votes
0 answers
361 views

Question on Ramsey model with shock on technological level

I have a question on Ramsey Model. Consider the following one-sector, closed, representative household economy. I have the following Cobb Douglas production function in intensive form $$f(k)=Ak(t)^{\...
studentp's user avatar
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0 answers
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Austrian School Regret Theory

I am having a time thinking about how Ruthbard and Mises speak about trade agreements and the concept that every economic transaction is just because it is voluntary and subjectively benefits both ...
Erweitet's user avatar
2 votes
0 answers
37 views

Learning Resource Question - Computable General Equilibrium Modelling

Several years after graduation, I would like to learn some practical computable general equilibrium (CGE) modelling such as a CGE that can handle distributional outcomes. Does anyone know of open-...
EB3112's user avatar
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1 vote
1 answer
118 views

calculating a marginal effect for logit model

For the logit estimate of the slope parameter,I would like to obtain the marginal effect of the regressor ndisease evaluated at $\Lambda (x'\beta)=\bar{y}$, where $\bar{y}$ is mean of $y$. I obtain ...
studentp's user avatar
  • 120
2 votes
0 answers
354 views

Finding Labour Supply in Cobb Douglas type Utility Function

Once again self-study question: Given a household's utility function be: $$U = C^\alpha (1-L)^\beta$$ where, $L$ is labor supplied. Total labor time is normalized to $1$. $C$ is read household ...
Dayne's user avatar
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0 votes
0 answers
84 views

Solow Model With Land as Factor

Given the production function: $$Y = K^\alpha (AL)^\beta R^{1-\alpha -\beta}$$. Where $L, A$ grow at exogenously given rates $n, g$ respectively. $R$ is land and is constant in supply and given that $\...
Dayne's user avatar
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5 votes
1 answer
212 views

Solow Model with DRS and Human Capital

This is a self study question. I am novice at this and have only basic knowledge of solving such problems. \begin{align} Y &= AK^\alpha H^\beta \\ \dot{K} &= s_KY - \delta K \\ \dot{H} &= ...
Dayne's user avatar
  • 1,705
0 votes
2 answers
60 views

Which econometric model should I use?

I have the following model Expenditures = a + $b_1$ Output + $b_2$ Labor + $b_3$ CapitalStock + $b_4$ D where D is dummy variable that is Categorical. If tax is imposed, it takes 1. Or if tax is not ...
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