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A market is covered if all consumers will choose to buy from at least one of the firms at the prevailing prices. For example, consider a standard Hotelling model with two firms who are located at opposite ends of the unit interval. Suppose that each firm charges that same price $p$ and that consumers are uniformly located on $[0, 1]$. Finally, suppose that ...


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Pareto believed economics could be studied with the same mathematical rigor as physics, so it's quite possible he was speaking to the similarities between mathematical economics and classical mechanics (the latter of which was just coming into its own in the early 1900s). I'm a physicist by training too, and those similarities helped me rapidly cover a ...


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You should definitely adjust for inflation, as you should with all monetary variables. I wouldn't worry using the CPI, you could use an alternative indicator as a robustness check to see whether the choice of indicator affects your main conclusions.


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$$u(x, y) = 2$$ is a simple example of a continuous utility function with thick indifference curve. \begin{eqnarray*} u(x, y)= \begin{cases} x & x < 1 \\ 1 & 1 \leq x < 2 \\ x - 1 & x \geq 2 \end{cases} \end{eqnarray*} is another continuous utility function with thick indifference curve for $u=1$.


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Actually there is no single agreed upon definition of low middle and high class. For example, Pew research center uses the following definitions: “Pew Research defines middle-income Americans as those whose annual household income is two-thirds to double the national median. For a family of three, that ranges from \$42,000 to \$126,000 in 2014 dollars. ...


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It looks like a cash-accounting NPV that includes closing the position (selling the plant, the car, whatever) after the period of consideration. Asset values show up in the final term because cash accounting applies cash outlays to the period in which they actually occur. Typically, that asset value would be net of depreciation and therefore less than $I_0$. ...


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This doesn’t make sense, because Free Cash Flow (in each period) already takes changes in assets and liabilities into consideration.


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same as for a company, if you assume that you are buying it for the rent it will get you then the value of the asset is the sum of the discounted future cash flows (called FFO in RE) you can also apply the comparables methods, in this field we usually apply it with a slight twist we read it in terms of yield (inverse of the multiple) which is called a cap ...


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One could resort to auction to get the "actual" value of a property (i.e. the buyers' maximum willingness to pay). One way to say that a property is overvalued is from the fact that it doesn't get sold :)


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