Review Questions Eco 311

REVIEW QUESTIONS ECO311 . General residue and marketplace efficiency 1 equalize and demarcation partial and general equilibrium synopsis 2 use hypothetical demand and supply curves, decorate how general equilibrium is achieved. Discuss what is meant by the interdependence of markets and signifi canisterce of the feedback stamp. 3 Use the Edge worth box to pardon Pareto competency. 4 Illustrate and explain how the Production guess landmark is derived from the Edgeworth boxes. 5 Illustrate and explain how the Production initiative termination is derived from the Edge worth box. Markets with Asymmetric Information 1 Use the lemons fuss to illustrate and explain how asymmetric development leads to market failure. 2 let off the principal-agent relationship and citing examples cover the principal-agent problem. 3 Compare and contrast adverse selection and moral hazard in the market for insurance. Can one pull through without th e other? Risky and Certainty 1 Suppose Jeffrey is a salesman who is currently earning an income of R10 000 and is occurting 10 units profit. Jeffrey can earn that income future(a) year with certainty. Jeffrey is offered a chance to command a impeccable salesman rail line that offers a 0.5 probability of earning R16 000 pliable 16 units of utility if he is successful and 0.

5 probability of earning R5 000 pliant 5 units utility if he not successful. Should Jeffrey take the new job? 2 Illustrate and explain the difference amongst and individual who is put on the line neutral, risk averse and risk referrer (loving). outgo theories ! 1) Illustrate and apologize the lifespan calendar method system 2) Explain how the Life Cycle surmise by Ando- Modigliani is related the steadfast Income Hypothesis by Milton Friedman. 3) What are the main weaknesses of the Life Cycle Hypothesis? 4) Which theory of consumption is closer to the actual comment of the literal world? 5) Define and explain automatic stabilizers....If you indigence to get a full essay, order it on our website: OrderCustomPaper.com

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