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Uses of price and income elasticity of demand: The concept of price elasticity of demand has some uses whihc include the following: (i) Pricing of goods and services It is
criticism of cournot model
Discuss the impact of rational self-interest on each of the following decisions
The price elasticity ( ε ) of demand for Q has been estimated at -0.5. Current consumption Q* is 70 units and market price (P*) is 0.70. a. Fit a linear demand curve to the obs
The minimum wage was increased in 1996 amid cries by various economists that it would cause unemployment. Critics shown that the last time the minimum wage went up the si
Distinction Between Cost and Expenditure As has already been defined, cost is the money equivalent of material and human resources needed to produce a good or a service. Expen
Consider the model of corruption explored by Shleifer and Vishni's where there is one government-produced good X. There is a demand for that good described by the inverse demand eq
Assignment: Externalities •Consider the following scenario: The city council has just approved the construction of a water park in your town. As city economist, you are responsible
Solution of this case study
(a) What is meant by heteroscedasticity and what are the consequences of applying OLS estimation in its presence? (b) Explain in details the Generalised least Square procedure
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