ECO 3145 Lecture 6: Lecture 6.pdf

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aquamarinepig787

15 Jun 2014

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13. 1, 13. 4: structure of the problem single constraint: Notation: example consumption problem: subject to. , for all i, and subject to and. Unlike the case of equality constraints, there is no need for. , since any number of inequality constraints can still leave a non-trivial range of variation for the choice variables. Kuhn-tucker (first-order necessary) conditions for a maximum: and with complementary slackness. , for all sign direction: diagram complementary slackness conditions. Minimizing a function f is equivalent to maximizing. Kuhn-tucker conditions compare the value of the objective function obtained under different combinations choose the combination/ solution with the highest value of the objective function. Tricks in theoretical papers in practice, it can be very tedious to check all the cases which arise in a kuhn-tucker optimization problem. Fortunately, economic intuition can often help us to narrow down the choices theoretical papers often assume away corner solutions e. g. the famous inada conditions have.

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""Please give answer with simple explaination""""Please give answer with simple explaination""""Please give answer with simple explaination""

1. In every society, choices must be made because resources are

a. Infinite, but economic want are finite

b. Finite, but economic wants are insatiable

c. Unlimited, but economic wants limited

d. Limited, and so are economic wants

2. Which question is an illustration of a microeconomic question

a. Is the quantity of wine purchased in one year dependent upon the price of wine?

b. Does government spending influence the total level of employment in the economy?

c. Is the purchasing power of the dollar higher or lower today than it was in 2000?

d. Is capitalism superior to socialism?

3. The purpose of the ceteris paribus assumption used in economic analysis is to :

a. Avoid making normative statements

b. A void the post hoc, ergo propter hoc fallacy

c. Make sure that all relevant factors are considered

d. Restrict the analysis to effect of a single economic factor

4. The profit motive is

a. Ineffective at producing consumer goods

b. Inherently beneficial to society if left alone to pursue its own self interests

c. Effective at producing goods when consumption is non-rival or non-excludable

d. Is often at odds with societies interests

5. In the system of central planning

a. There is repaid of the infrastructure

b. There is severe inflation in wholesale and retail prices

c. Economic growth leads to widespread unemployment among workers

d. The outputs of some industries become inputs for other industries

6. The market system communicates changes in supply and demand and elicits appropriate responses from businesses and resource suppliers. This is known as the:

a. Rationing function of prices

b. Guiding function of prices

c. Monetary function of prices

d. Circular flow of income

7. An increase in the quantity of automobiles supplied would be caused by which be caused by which of the following?

a. An increase in the demand for automobiles

b. A decrease in the demand for automobiles

c. Higher prices for steel

d. Higher prices for gasoline

8. All of the following would cause an increase in the demand for private airplanes at a given price, except a:

a. Decrease in interest rates

b. Increase in consumer incomes

c. Decrease in taxes on luxury goods

d. Decrease in the costs of constructing private airplanes

9. In modern economies of mass production,

a. Biological need motivates most consumption

b. The intrinsic value of goods and services motivates mass consumption

c. Affluence makes relative depravation meaningless

d. Invidious comparison motivates much of mass consumption

10. a more equal distribution of income in the United States would result in greater total consumer satisfaction. This statement is based on the concept that:

a. Income inequality is unfair

b. Income inequality is undemocratic

c. Income equality stimulates efficiency

d. Incomes are subject to diminishing marginal utility

11. While command systems suffer from incentive problems, market economies

a. Have no incentive problems

b. Suffer from incentive problems of their own

c. Tend to resolve all problems by their own dynamics

d. Have problems to the degree that there is government interference.

12. What economic concepts can be used to explain the reason that a new car purchased by a consumer and driven off a new car lot decrease in value almost immediately compared with the value of the same make and model of a car still on the new car lot?

a. Positive and negative externalities

b. Liability rules and lawsuits

c. The Coase theorem and moral hazard

d. Asymmetric information and adverse selection

13. Consider a situation where the U.S. Congress wants to place a special tax on private airplanes to increase tax revenue. This tax would only be effective in raising new tax revenues if the price elasticity of:

a. Supply is elastic

b. Supply is inelastic

c. Demand is elastic

d. Demand is inelastic

14. Under what circumstances would you expect economic profits to be zero in a particular industry?

a. During a recession

b. When there is little competition in the industry

c. When the industry is neither expanding nor contracting

d. When the demand for the product being produced is increasing

16. If economic resources are perfectly interchangeable between the two products shown on a production possibilities graph:

a. The economy will always be at full employment

b. More of one product can be produced without producing less fo the other product

c. The production possibilities curve would be straight line

d. The two products are of equal value to the economy

17. Opportunity cost is best defined as:

a. Marginal cost minis marginal benefit

b. The time spent on an economic activity

c. The value of the best foregone alternative

d. The money cost of an economic decision

18. All of the following would affect the position of a country production possibilities curve expect:

a. The quality of labor

b. The level of employment

c. The amount of the capital stock

d. Technological progress

19. The post hoc, ergo propter hoc fallacy consists of:

a. Using an example to a different point

b. Inferring causality from chronological sequence

c. Jumping to conclusions from an inadequate number of cases

d. Arguing for or against the person rather than the position being supported

20. Which is one of the five fundamental question that needs to be answered by economic system

a. What is the rate of unemployment?

b. Who will be the richest person in the economy?

c. What goods and services will be produced?

d. Why are the prices for goods and services so high?

21. The institution of private property is sustained over time by:

a. Competition

b. Bequests

c. Self-interest

d. Free enterprise

lilacmosquito322

9. Write a method with the following header public static void replace (String oldFile, string newfile, char oldChar, char newChar) throws IOException This method opens the file whose name is given by the String parameter oldFile (the input file) for reading, and opens the file whose name is given by the string parameter newlile (the output file) for writing. It then reads every lime in the input file. For each line, it creates a new line identical to the original line, creept for the fact that all occurrences of char oldchar in the original String have been replaced by occurrences of char newchar in the new line. When the new line has been properly created, it write it to the output file. Once all the lines in the input file have been read and a corresponding line has been written to the output file, the method clases both files. Additional notes: • You MAY assume that none of the parameters this method accepts are null; in other words, your method does not have to handle the case where one or more of the parameters are null. You MAY assume that all the 10-related classes have already heen imported properly . Finally, because the replace() method is specified to throw an exception object of type TORxception, you MAY assume that I/O related problems will occur while reading from the input file or writing to the output file. In other words, your method DOES NOT have to check that no such problems occur, and DOES NOT have to manage Texceptions using try-catch blocks. WRITE YOUR replace() METHOD IN THE SPACE BELOW: YOUR replace() METHOD CONTINUED: USE THIS PAGE IF YOU NEED ADDITIONAL SPACE. CLEARLY INDICATE WHICH QUESTION(S) YOU ARE ANSWERING HERE. USE THIS PAGE IF YOU NEED MORE ADDITIONAL SPACE. CLEARLY INDICATE WHICH QUES- TION(S) YOU ARE ANSWERING HERE. • String (package java.lang) Methods: - public String chal wale Al t ri g od med in the chance au - public int length(): R e ach of the string - public char chattin R echar w heefd index public chart to Chachay: Consthis String to a new c r y - public boolean equals Object anbject): Ce this string to and yect - public boolean equalsigmoce Case String anotherstring]: Cam p ing sider this String to anotherString - public int compareToString anotherString: Compare this String to anotherstring graphically returns a negative ef this string before anotherstring, apithe value of this Stringatering distries publie iw paneelgoro (String another Camp i ng Garden ces, string to anoth i ng li hically returns te value of this thing care anotherstring, apie as if this string e r anotherstring, Strings - public int indexin ch Rather within this string of the och ch-lil does not - public int index fint.ch, int from index): Returns the index within this string of the first Roe of character ch, starting the search at position from Index retums - 1 il ch does not in this String - public int indexor (String ste): Returns the index within this string of the first currence of ringt-d eur - public int indexOf(stringate, int from index): Resures the index within the string of the fare currence of shariaparting police froiden liste des not count i ng - public String subat ring it begintndax) Rema new string which is a webstring of this string compend of the chesting at position begintndex (inclusive) - puble string subat ring intaginindex intendindex: Returns a new sering that waring of this string, composed of the characters starting at position beginIndex (inclusive, and ending at - public String replace(char oldChar, char newchar): Returns a new string resulting from replacing a Tences of olchar in this string with new Char. puble string tolon Case(): Returns a new string consisting of all the characters in this sting - publle ting toppe : Roum ingiting of all the c on in this thing uverted to perce - publie ting tet): Returns a copy of this line with leading and wailing whitespace • Scanner (package java.util) Methods: - publie danner File source) thrown jatorio Foundation sa Scanner the fun the specified file - public scanner InputStream source): Cits Scanner that process and from the input stream - puble Scannerstag source): Corsa ww Scanner that produces wales w ed from the specified String -puble vold close(): Cwes this Scanner -puble boolean asext(): Return this can het in its input puble boolean asext.Double(): Return to the taken in this season al ante pasadala w ith Doble() ed publie boolean hat Into: Reutte le inse gule ed wat w eet Int() had - public boolean hati : Return true if this w ee - puble boolean has longt) Return true if the r in this cannerm ane das along the next long) with puble ting at the t e rm from the canner puble double Smerthea ter puble intention there the l ot. puble w ith the need them - puble Intolog m u long • Printstream ( kape Java.io) Methods: a - Pri le rlle) throw alo.Pilo t Pelat ihan the p rile - Printing the throw r alo. Pet Stichw e d the wind - le void lose them - le void phone boolean ve - void prichar public void print chart 6): the way of char public void print double d o uble bed, public void print (int ) Fins int value - public void printet a n net public void printing : Strings - public void printin (1 Tm the line by writing the line para ring - public void printinhoolna ) Prints hoolean when thinorminates the public void printin (cthar c h ar wheelthening the line public void print in char i ta way of cars and then the line public void print in double d in double valued and the terminates the line public void printin(int 1) Pints int value and then into the line public void printin ( jat ova t terminates the line pulle void print intring): Tits Strings then to the line Note that the printwriter class defines the same methods and constructors (except for the fact that the structors are called Print.writer instead of PrintStream) • Math (package java.lang) Methods: - please le podle double bear the value of a t the of - puble balle blanche a Returns they u se of dele with pe r than realto - pietate double random Ruma doble 0.0 wi th .. puble stat la doble sin double a: Rethe puble statie doble con double a Return ther l e, where a ininin we angle, wherea in in e -puble statie doble tan double a) R he i ngold , whereas o m public statie double toeges double agrad): C a ngrad v ideo puble salle de anable and we a r e - - estatie delle au t olewa idle de ahholooble • Character (packape java.lang) Methods: - public static boolean ibigit charch: D i chtechisadil public static int digit(charch, int radix: Return the meal of cho ch in the di radix-lich des representa digit - public statie char forbigit chat digit, ut radix) Rems the character of digit in the disa - public statie boolean isletter charch): Demines if character chalet publle statie boolean islowerCase(char ch): Determines if character ch is a character - public static boolean ipparate(char eh): Determines ir ductes chinuppercase cura nd - publicatie boliwhip (arch Termine if character his white a intola - public static char tolowrane(char chevert hech to low - public static char tolpperCase(char ch): Covers Chococh topp • Array list (package java.util) Methods: - public ArrayList(): Create a new em ArrayList which contains clements of type - public int (1 : R m the number of clans in this list - public boolean isimpty(): Rens true if this in contains no elements - public boolean contains (object o): Return true if this lintutins el compr a re performed using the equals() method on - public int IndexOf(obj ): Returns the index of the first currence of elemento in this list, or lir this listes contain this element companies are performed wing the equals() method - publiek galimt in ): Returns the elementat position index in this list - publieket fint inde element): Replace the element at the position index in this list with the - puble honlanad a ): Appends the specifiedalent to the end of this list. - public void (int in aw e t the specified element the price index in this - publiek veint index): Remove the de s ition index in the list - publie hoolean remove(object a s the fir e of the president of this if it is p r epared wing the equals() methodno - public void clear(): Remes all of the elements from this • Vile (package java.io) Methods: - puble File(String pathname: Creates a File representing the file at the given pathane

Need help revising, and recommendation for a conclusion.

Throughout this paper is my understanding of what I have learned in class chapters 1-4, expressing my understanding and opinions. Economics is the study of how we deal with scarce resources. Microeconomics specially deals with business in the home country exclusively. This type of economics affects small businesses in the home country only. On the other hand, macroeconomics concerns our national welfare concerning trade and international business.

I believe that many things affect our economy on a microeconomics level. Things such as our understanding of our country in reflection to the world are very important. That is why we study ourselves before we study the macroeconomic principle of the world. Understanding ourselves is what microeconomics teaches us. Working from the inside out. The world is a place where there are differences in our wants and what we get. That is what makes items scarce. That is what positive economics is. Positive economics deals with what is and what we have. The other type of economics is called normative statements. This deals with what we should receive instead of what is and deserved to some extent. It's our scarce resources that determine our allocation of resources and how we use our resources and time. This is where opportunity costs come in, giving up something to do something. A successful business or country never ignores opportunity costs. We must ensure that we have a comparative advantage instead of the absolute advantage. Our resources must be used to achieve maximum output. Comparative is met when we have fewer opportunity costs to make some certain products than the other person or entity.

My initial understanding was scarcity was oil potentially running out, but we have so much of it that you can always find more with techniques such as fracking. Now it's obvious to me, one of our most scarce resources is time. You cannot avoid the 8,760 hours in a year. I understand that people have unlimited wants but limited resources. Everything has a cost and we must make a choice as we don't have unlimited farms, factories workers, etc. scarcity forces choices and this ties in with opportunity cost, for every gun made, a theft from the hungry is made. The opportunity cost not being used to feed the poor, but to make guns. And I find it easy to understand no one can have everything choices must be made on benefits. If I'm going to school, imp giving up making cash, as I'm giving up money for an education, I value education more. Scarcity is also related to the invisible hand. As it's an achievement that leads free markets and capitalism through competition for scarce resources.

My understanding of the invisible hand is a person neither intends to promote public interest and does not know how much he is promoting it. Only intending on his own gain. Without being his intention a person can be lead by the invisible hand to do good for society by pursuing one's own self-interest. Going into equity and efficiency the invisible hand does ensure both equity and efficiency. People work in their selfish ways to maximize profit while also contributing to the economy as a whole. It can also be argued that as the invisible hand wants to ensure efficiency, it cannot guarantee efficiency, because it can fail to produce an efficient allocation of resources, which in turn lead to a market failure. It can also be argued that it can't guarantee equity because not everyone gets a fair price. The way I like to remember efficiency is with a real-life example, like a reduction in the number of workers needed to produce a particular good for a particular amount. Equity refers to the ownership interest in an asset, for example, if a person owns a house with a market value of $800,000 and owes $100,000 on the mortgage leaving a $700,000 equity in the home.

It can be predicted that if the price of beef increases - ceteris paribus-the quantity of beef demanded by buys will decrease. In other words, if the price of beef increases, then the quantity of beef increases, then the quantity of beef demanded will decrease because all things have to be equal. In-class lecture thought me all other things remaining the same. Economists use ceteris paribus to determine the effect of a factor when all other factors have been held the same and helps simplify the study and get a more refined data set.

Economists deal with many issues that pertain to assuring that both a countries domestic output is efficient and that there is an effective trade balance. This means that there are a balance and limit on the amount of imports. Also, this means home production must be able to meet export demands. There are many factors that affect the production of goods and their effect on shifting the production possibilities frontier. This involves evaluating every detail including knowing the products and any close substitutes and compliments. It also involves knowing how an action or other external force will affect demand. This is called price elasticity; Substitutes are products that can replace any given product or service. An example of this would be Coke and Pepsi. The presence of substitutes affects price elasticity because if there are other options, then any change to the price or quality of the product will cause a shift of the demand curve. O course, price is a huge reason why the demand for a product decreases or increases yet it doesn't shift the curve because of the price only. This price change will cause a domino effect that will end with the shifting of the demand curve because it will cause an increase or decrease in demand of the substitute good if the price change is either lower or higher respectively. This price change serves as a catalyst that will change people's desire to spend more money on a more expensive product and that will instead choose to buy the substitute good for cheaper or buy more of the desired product. The change in the price of actual products will not shift the demand curve yet the change of the price of substitutes will because it serves to change people's purchasing behavior. On the other hand, compliments serve to boost demand when there is a decrease in price. The use of complementary goods is dependent upon another product. An example of this would be hot dogs and buns. If the price of hotdogs decreases then, conversely, the demand for hot dog buns will increase because of this change in price. In this scenario, the decrease in price will cause a positive shift in the demand curve because of people's desire and willingness to buy more buns. This is an example of a demand shifter. There are a few other demand shifters. The shifters of the demand curve are changes in expectations, disposable income, price of substitute goods and complements, tastes and preferences, and population size and composition. Changes in income affect the demand curve because if income is lower then people tend to save any extra income instead of wasting it. Disposable income is minimized and spending is lower. This also causes people to see a perceived value of things and distinguishing between what is necessary and what is a relative luxury. The lower the income, the higher the saving and avoidance to spend. An example of this would be if someone needs to buy some medication and it is relatively expensive, that doesn't mean that someone won't buy the medication just because it is expensive. It is necessary. Other factors that contribute to spending and demand are having a price ceiling and price floor. Having a price ceiling is a limit on the price of the product this is a government-imposed idea that is meant to protect consumers from unfair pricing and other conditions that may be malicious or obscure. This affects demand because if there is a price ceiling there is a limit on profit on a unit-to-unit basis. The other factor is the price floor. This price floor was created to encourage competition and affect consumers' willingness to pay because sometimes this new price may be higher than the original price. This causes a negative impact on a product that has a less than wanted perceived value. Many factors contribute to economic prosperity and certainly do help assure that information is analyzed and implemented into an economic and business plan.
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ECO 3145 Lecture 6: Lecture 6.pdf

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