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What is opportunity cost? Answer: Opportunity cost is a term used in economics, to mean the cost of something in terms of an opportunity foregone (and the advantages that co
Q. What is Gini Coefficient? Gini Coefficient: A statistical measure of inequality. A Gini score of 0 signifies perfect equality (in which each individual receives the same inc
What is ceteris Paribus? Ceteris paribus is a Latin phrase, literally translated as "other things the similar," and usually rendered in English as "all other things being equa
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The Industry's Long-Run Supply Curve * Long-Run Elasticity of Supply 1) Constant-cost industry Long run supply is horizontal Small increase in price will induc
Principle Agent Problem [Dealing with hidden action] Assume that the employer (principle) wants its employee (agent) to work hard [You can safely assume that this maximizes th
having utility function U(x,y)= x1/2=y1/2, determine the hicksian demand function, expenditure function and indirect utility function.
would a rational producer be concerned with the average or marginal product of an input in deciding whether or not to hire the inputs?
Prove that utility approach and indifference curve yield the same consumer equilibrium
Long Run Average Cost (or LAC) -Constant Returns to Scale If the input is doubled, the output will double and average cost is constant at all the levels of output.
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