Chapter 6. Elasticity: The Responsiveness of Demand and Supply

Size: px
Start display at page:

Download "Chapter 6. Elasticity: The Responsiveness of Demand and Supply"

Transcription

1 Chapter 6. Elasticity: The Responsiveness of Demand and Supply Instructor: JINKOOK LEE Department of Economics / Texas A&M University ECON Principles of Microeconomics

2 Elasticity Demand curve: the relationship between the price of a good and the quantity demanded. Beyond the law of demand, we want to know how much the quantity demanded change as a result of a price increase or decrease. Economists use the concept of elasticity to measure it. Elasticity: A measure of how much one economic variable responds to changes in another economic variable.

3 Price Elasticity of Demand Price elasticity of demand: The responsiveness of the quantity demanded to a change in price Price elasticity of demand = % change in quantity demanded % change in price (1) price elasticity of demand is not the same as the slope of the demand curve. the measurement of slope is sensitive to the units chosen for quantity and price. price elasticity of demand is always negative. but we drop - sign and compare their absolute values.

4 Elastic/Inelastic Demand Elastic Price elasticity > 1 Inelastic Price elasticity < 1

5 Elastic/Inelastic Demand Unit-elastic Price elasticity = 1 Perfectly elastic Price elasticity =

6 Elastic/Inelastic Demand Perfectly inelastic Price elasticity = 0

7 Midpoint Formula It is possible to have different values for the price elasticity of demand between the same two points on the same demand curve. To ensure that we have only one value of the price elasticity of demand, we use the midpoint formula. Elasticity by Midpoint Formula (Q 2 Q 1 ) (P2 P 1 ) ( Q 1 +Q 2 2 ) ( P 1 +P 2 ) 2

8 Determinants of Price Elasticity of Demand Why do price elasticities differ among products? (1)Availability of Close Substitutes In general, if a product has more substitutes available, it will have more elastic demand. If a product has fewer substitutes available, it will have less elastic demand. (2)Luxuries versus Necessities The demand curve for a luxury is more elastic than the demand curve for a necessity.

9 Determinants of Price Elasticity of Demand Why do price elasticities differ among products? (3)Passage of Time It usually takes consumers some time to adjust their buying habits when prices change. The more time that passes, the more elastic the demand for a product becomes. (4)Definition of the Market The more narrowly we define a market, the more elastic demand will be. (5)Share of a Good in a Consumer s Budget the demand for a good will be more elastic the larger the share of the good in the average consumer s budget.

10 Elasticity and Total Revenue Total revenue: price per unit number of units sold. When demand is elastic (inelastic), a cut in price will increase (decrease) total revenue.

11 Demand, Total Revenue, Marginal Revenue Q1. Draw demand curve, total revenue curve, and marginal revenue curve. Q2. Describe the relationship between price elasticity of demand and total revenue. Q3. Describe the relationship between marginal revenue and total revenue.

12 Cross-Price Elasticity of Demand Cross-price elasticity of demand (C-PE) measures the effect of an increase in the price of one good on the quantity of another good demanded. The C-PE can is positive or negative, depending on whether the two products are substitutes or complements. Cross price elasticity of demand = % change in quantity demanded of one good % change in price of another good (2)

13 Income Elasticity of Demand Income elasticity of demand (IE) measures the responsiveness of quantity demanded to changes in income. Income elasticity of demand = % change in quantity demanded % change in income (3) Income elasticity > 0 : Normal good. 1 < IE : luxury good. 0 < IE < 1 : necessity good. Income elasticity < 0 : Inferior good.

14 Application: Elasticity and the Disappearing Family Farm We can use price elasticity and income elasticity to analyze economic issues. over the past 60 years, supply curve for wheat has moved to the right largely. income elasticity of demand for wheat was low, so demand for wheat increased relatively little. price elasticity of demand is also low, so demand curve is steep relatively. The large shift in the supply curve and the small shift in the demand curve resulted in a sharp decline in the price of wheat.

15 Price Elasticity of Supply Price Elasticity of Supply: The responsiveness of the quantity supplied to a change in price. Price elasticity of supply = % change in quantity supplied % change in price (4) the price elasticity of supply will be a positive number. elastic (>1), inelastic (<1), unit-elastic(=1). perfectly elastic (= ), perfectly inelastic (= 0)

16 Application: Changes in Price Depend on the Price Elasticity of Supply Demand Typical and Demand July4 represent the typical demand for parking spaces and demand on the Fourth of July. in figure (a), supply is inelastic, shifting from A to B results in a large increase in price and a small increase in the quantity supplied. in figure (b), supply is elastic, shifting from A B results in a smaller increase in price and a larger increase in the quantity supplied.

Econ 2113 Test #1A Pledge: I have neither given or received aid on this exam. Signature:

Econ 2113 Test #1A Pledge: I have neither given or received aid on this exam. Signature: Econ 2113 Test #1A Dr. Rupp Fall 2009 Name: Pledge: I have neither given or received aid on this exam. Signature: Multiple Choice Identify the letter of the choice that best completes the statement or

More information

Indifference Curves: An Example (pp. 65-79) 2005 Pearson Education, Inc.

Indifference Curves: An Example (pp. 65-79) 2005 Pearson Education, Inc. Indifference Curves: An Example (pp. 65-79) Market Basket A B D E G H Units of Food 20 10 40 30 10 10 Units of Clothing 30 50 20 40 20 40 Chapter 3 1 Indifference Curves: An Example (pp. 65-79) Graph the

More information

ENTREPRENEURIAL FINANCE: Strategy Valuation and Deal Structure

ENTREPRENEURIAL FINANCE: Strategy Valuation and Deal Structure ENTREPRENEURIAL FINANCE: Strategy Valuation and Deal Structure Chapter 7. Methods of Financial Forecasting: Integrated Financial Modeling Questions and Problems 1. The cash cycle is the time between when

More information

Choose the single best answer for each question. Do all of your scratch work in the margins or in the blank space on the last page.

Choose the single best answer for each question. Do all of your scratch work in the margins or in the blank space on the last page. Econ 101, Section 1, F09, Schroeter Final Exam, Red Choose the single best answer for each question. Do all of your scratch work in the margins or in the blank space on the last page. 1. Pete receives

More information

Chapter 4. Specific Factors and Income Distribution

Chapter 4. Specific Factors and Income Distribution Chapter 4 Specific Factors and Income Distribution Introduction So far we learned that countries are overall better off under free trade. If trade is so good for the economy, why is there such opposition?

More information

ECONOMETRICS PROJECT ECON-620 SALES FORECAST FOR SUBMITED TO: LAURENCE O CONNELL

ECONOMETRICS PROJECT ECON-620 SALES FORECAST FOR SUBMITED TO: LAURENCE O CONNELL ECONOMETRICS PROJECT ECON-620 SALES FORECAST FOR SUBMITED TO: LAURENCE O CONNELL SUBMITTED BY: POOJA OZA: 0839378 NISHTHA PARIKH: 0852970 SUNNY SINGH: 0368016 YULIYA INOZEMYSEVA: 0817808 TABLE OF CONTENTS

More information

ACCOUNTING Ph.D. PROGRAM REQUIREMENTS KRANNERT GRADUATE SCHOOL OF MANAGEMENT (revised July 2014)

ACCOUNTING Ph.D. PROGRAM REQUIREMENTS KRANNERT GRADUATE SCHOOL OF MANAGEMENT (revised July 2014) ACCOUNTING Ph.D. PROGRAM REQUIREMENTS KRANNERT GRADUATE SCHOOL OF MANAGEMENT (revised July 2014) Introduction The doctoral program in Accounting at the Krannert Graduate School of Management is designed

More information

Health Economics. University of Linz & Demand and supply of health insurance. Gerald J. Pruckner. Lecture Notes, Summer Term 2010

Health Economics. University of Linz & Demand and supply of health insurance. Gerald J. Pruckner. Lecture Notes, Summer Term 2010 Health Economics Demand and supply of health insurance University of Linz & Gerald J. Pruckner Lecture Notes, Summer Term 2010 Gerald J. Pruckner Health insurance 1 / 25 Introduction Insurance plays a

More information

The Elasticity of Demand for Health Care

The Elasticity of Demand for Health Care The Elasticity of Demand for Health Care A Review of the Literature and Its Application to the Military Health System Jeanne S. Ringel Susan D. Hosek Ben A. Vollaard Sergej Mahnovski Prepared for the Office

More information

a. What is the total revenue Joe can earn in a year? b. What are the explicit costs Joe incurs while producing ten boats?

a. What is the total revenue Joe can earn in a year? b. What are the explicit costs Joe incurs while producing ten boats? Chapter 13 1. Joe runs a small boat factory. He can make ten boats per year and sell them for 25,000 each. It costs Joe 150,000 for the raw materials (fibreglass, wood, paint, and so on) to build the ten

More information

14.01 Principles of Microeconomics, Fall 2007 Chia-Hui Chen October 15, 2007. Lecture 13. Cost Function

14.01 Principles of Microeconomics, Fall 2007 Chia-Hui Chen October 15, 2007. Lecture 13. Cost Function Short-Run Cost Function. Principles of Microeconomics, Fall Chia-Hui Chen October, ecture Cost Functions Outline. Chap : Short-Run Cost Function. Chap : ong-run Cost Function Cost Function et w be the

More information

INTRODUCTORY MICROECONOMICS

INTRODUCTORY MICROECONOMICS INTRODUCTORY MICROECONOMICS UNIT-I PRODUCTION POSSIBILITIES CURVE The production possibilities (PP) curve is a graphical medium of highlighting the central problem of 'what to produce'. To decide what

More information

Introduction. Employer sponsored health insurance, Part 1. This section of class

Introduction. Employer sponsored health insurance, Part 1. This section of class ntroduction Employer sponsored health insurance, Part 1 ECON 40447 Fall 2009 1 Most health insurance in this country is provided by employers as a fringe benefit Function of the tax-preferred nature of

More information

Paper F5. Performance Management. Monday 2 June 2014. Fundamentals Level Skills Module. The Association of Chartered Certified Accountants

Paper F5. Performance Management. Monday 2 June 2014. Fundamentals Level Skills Module. The Association of Chartered Certified Accountants Fundamentals Level Skills Module Performance Management Monday 2 June 2014 Time allowed Reading and planning: Writing: 15 minutes 3 hours ALL FIVE questions are compulsory and MUST be attempted. Formulae

More information

chapter: Solution Solution The Rational Consumer

chapter: Solution Solution The Rational Consumer S11-S156_Krugman2e_PS_Ch1.qxp 9/16/8 9:21 PM Page S-11 The Rational Consumer chapter: 1 1. For each of the following situations, decide whether Al has increasing, constant, or diminishing marginal utility.

More information

Should New Merger Guidelines Give UPP Market Definition?

Should New Merger Guidelines Give UPP Market Definition? December 2009 (Release 1) Should New Merger Guidelines Give UPP Market Definition? Richard Schmalensee Massachusetts Institute of Technology & LECG www.competitionpolicyinternational.com Competition Policy

More information

Rafal Borkowski, Hipoteczna 18/22 m. 8, 91-337 Lodz, POLAND, E-mail: r-borkowski@go2.pl

Rafal Borkowski, Hipoteczna 18/22 m. 8, 91-337 Lodz, POLAND, E-mail: r-borkowski@go2.pl Rafal Borkowski, Hipoteczna 18/22 m. 8, 91-337 Lodz, POLAND, E-mail: r-borkowski@go2.pl Krzysztof M. Ostaszewski, Actuarial Program Director, Illinois State University, Normal, IL 61790-4520, U.S.A., e-mail:

More information

Practice Problems on Money and Monetary Policy

Practice Problems on Money and Monetary Policy Practice Problems on Money and Monetary Policy 1- Define money. How does the economist s use of this term differ from its everyday meaning? Money is the economist s term for assets that can be used in

More information

The Effectiveness of Mobile Wireless Service as a Competitive Constraint on Landline Pricing: Was the DOJ Wrong?

The Effectiveness of Mobile Wireless Service as a Competitive Constraint on Landline Pricing: Was the DOJ Wrong? 11 December 2008 The Effectiveness of Mobile Wireless Service as a Competitive Constraint on Landline Pricing: Was the DOJ Wrong? William E. Taylor and Harold Ware 1 The US Department of Justice (DOJ)

More information

Econ 201 Lecture 17. The marginal benefit of expanding output by one unit is the market price. Marginal cost of producing corn

Econ 201 Lecture 17. The marginal benefit of expanding output by one unit is the market price. Marginal cost of producing corn Econ 201 Lecture 17 The Perfectly Competitive Firm Is a Taker (Recap) The perfectly competitive firm has no influence over the market price. It can sell as many units as it wishes at that price. Typically,

More information

Demand Estimation in OFT s Investigations

Demand Estimation in OFT s Investigations Demand Estimation in OFT s Investigations Enrico Pesaresi Head of Econometrics, OFT ACE Conference Paris, 26 October 2012 The views expressed are those of the author and cannot be regarded as stating an

More information

Cybersecurity, industrial organization, and competition policy

Cybersecurity, industrial organization, and competition policy Cybersecurity, industrial organization, and competition policy Michael Riordan Columbia University 7/5/14 CRESSE 2014 1 7/5/14 CRESSE 2014 2 C Chinese Army Unit Is Seen as Tied to Hacking Against U.S.

More information

Electric Utility Capacity Expansion: Its Implications for Customers and Stockholders

Electric Utility Capacity Expansion: Its Implications for Customers and Stockholders SPECIAL ISSUE Special Electricity Issue 983 Pages 1-11 Electric Utility Capacity Expansion: Its Implications for Customers and Stockholders by Stephen C. Peck (Electric Power Research Institute, Palo Alto,

More information

1 Economic Application of Derivatives

1 Economic Application of Derivatives 1 Economic Application of Derivatives deriv-applic.te and.pdf April 5, 2007 In earlier notes, we have already considered marginal cost as the derivative of the cost function. That is mc() = c 0 () How

More information

Demand for Health Insurance

Demand for Health Insurance Demand for Health Insurance Demand for Health Insurance is principally derived from the uncertainty or randomness with which illnesses befall individuals. Consequently, the derived demand for health insurance

More information

Monopoly. Announcements

Monopoly. Announcements Monopoly 1 1. Types of market structure 2. The diamond market 3. Monopoly pricing 4. Why do monopolies exist? 5. The social cost of monopoly power 6. Government regulation 2 Announcements We are going

More information

Chapter 4 Specific Factors and Income Distribution

Chapter 4 Specific Factors and Income Distribution Chapter 4 Specific Factors and Income Distribution Chapter Organization Introduction The Specific Factors Model International Trade in the Specific Factors Model Income Distribution and the Gains from

More information

Chapter 13 Controlling Market Power: Antitrust and Regulation

Chapter 13 Controlling Market Power: Antitrust and Regulation Page 1 Chapter 13 Controlling Market Power: Antitrust and Regulation 1)Which of the following is an example of natural monopoly? A) a market for cable TV services B) a market for breakfast cereals C) a

More information

College Readiness Math MOOC

College Readiness Math MOOC College Readiness Math MOOC Instructor Information: Dr. Jennifer Kosiak, jkosiak@uwlax.edu General email: mathmooc@uwlax.edu Mathematics Department, University of Wisconsin- La Crosse Description: The

More information

Real-Time Pricing and Demand Side Participation in Restructured Electricity Markets

Real-Time Pricing and Demand Side Participation in Restructured Electricity Markets Real-Time Pricing and Demand Side Participation in Restructured Electricity Markets Robert H. Patrick Frank A. Wolak Graduate School of Management Department of Economics Rutgers University Stanford University

More information

GCE. Economics. Mark Scheme for June 2010. Advanced GCE F581 Markets in Action. Oxford Cambridge and RSA Examinations

GCE. Economics. Mark Scheme for June 2010. Advanced GCE F581 Markets in Action. Oxford Cambridge and RSA Examinations GCE Economics Advanced GCE F581 Markets in Action Mark Scheme for June 2010 Oxford Cambridge and RSA Examinations OCR (Oxford Cambridge and RSA) is a leading UK awarding body, providing a wide range of

More information

Q D = 100 - (5)(5) = 75 Q S = 50 + (5)(5) = 75.

Q D = 100 - (5)(5) = 75 Q S = 50 + (5)(5) = 75. 4. The rent control agency of New York City has found that aggregate demand is Q D = 100-5P. Quantity is measured in tens of thousands of apartments. Price, the average monthly rental rate, is measured

More information

Unit 9: Utility, Externalities, and Factor Markets Lesson 4: Externalities

Unit 9: Utility, Externalities, and Factor Markets Lesson 4: Externalities Unit 9: Utility, Externalities, and Factor Markets Lesson 4: Externalities Objectives: - Define externality - Draw negative and positive externality graphs. - Explain the remedies for positive and negative

More information

Urban Economics. Land Rent and Land Use Patterns PART II. 03.06.2009 Fachgebiet Internationale Wirtschaft Prof. Dr. Volker Nitsch Nicolai Wendland

Urban Economics. Land Rent and Land Use Patterns PART II. 03.06.2009 Fachgebiet Internationale Wirtschaft Prof. Dr. Volker Nitsch Nicolai Wendland Urban Economics Land Rent and Land Use Patterns PART II Housing Prices To assess the variation of housing prices within a city, we focus on commuting as the key determinant for residential location decisions.

More information

Examinations Page 1 MODULE 2 STUDENT GUIDE TO NOTE TAKING

Examinations Page 1 MODULE 2 STUDENT GUIDE TO NOTE TAKING Examinations Page 1 MODULE 2 STUDENT GUIDE TO NOTE TAKING Examinations Page 2 Why take notes? I have a good memory: It s just short" o s t o f u s c a n r e l a t e t o t h i s q u o t e. H a v e y o u

More information

Value Based Questions

Value Based Questions Subject : Economics Class : XII Value Based Questions PART A : INTRODUCTORY MICROECONOMICS Unit-I Introduction to Microeconomics 1. India is a labour abundance and capital scarce economy. Which technique

More information

CH 1 SOLUTIONS TO END-OF-CHAPTER EXERCISES

CH 1 SOLUTIONS TO END-OF-CHAPTER EXERCISES CH 1 SOLUTIONS TO END-OF-CHAPTER EXERCISES Answers to Thinking Critically Questions 1. When economists assume that people are rational, they assume that people use all available information as they act

More information

There are two different ways you can interpret the information given in a demand curve.

There are two different ways you can interpret the information given in a demand curve. Econ 500 Microeconomic Review Deman What these notes hope to o is to o a quick review of supply, eman, an equilibrium, with an emphasis on a more quantifiable approach. Deman Curve (Big icture) The whole

More information

Learning Objectives. Essential Concepts

Learning Objectives. Essential Concepts Learning Objectives After reading Chapter 3 and working the problems for Chapter 3 in the textbook and in this Workbook, you should be able to: Employ marginal analysis to find the optimal levels of activities

More information

Chapter 1 Linear Models page Linear Models Part 1 2 Linear Models Activities 1 17 Linear Models Part 2 21 Linear Models Activities 2 28

Chapter 1 Linear Models page Linear Models Part 1 2 Linear Models Activities 1 17 Linear Models Part 2 21 Linear Models Activities 2 28 Table of Contents Chapter 1 Linear Models page Linear Models Part 1 Linear Models Activities 1 17 Linear Models Part 1 Linear Models Activities 8 Chapter Linear Programming Linear Programming Part 1 34

More information

13. SAVINGS RATE: WHY IS IT DECLINING?

13. SAVINGS RATE: WHY IS IT DECLINING? 13. SAVINGS RATE: WHY IS IT DECLINING? Rama V. Ramachandran Summary. The savings rate declined in the United States dramatically from 7.3 percent in 1988 to 4.3% in 1998 and then to 0.4% in 2007. Such

More information

Econ 110 (Sec. 1), Principles of Microeconomics

Econ 110 (Sec. 1), Principles of Microeconomics Econ 110 (Sec. 1), Principles of Microeconomics Martin V. Smith School of Business and Economics California State University Channel Islands Course Syllabus, Spring 2015 Course: Econ 110, Principles of

More information

Price and Income Elasticity of the Demand for Health Insurance and Health Care Services: A Critical Review of the Literature

Price and Income Elasticity of the Demand for Health Insurance and Health Care Services: A Critical Review of the Literature Contract No.: 233-02-0086 MPR Reference No.: 6203-042 Price and Income Elasticity of the Demand for Health Insurance and Health Care Services: A Critical Review of the Literature Final Report March 24,

More information

Tennessee Agricultural Production and Rural Infrastructure

Tennessee Agricultural Production and Rural Infrastructure Tennessee Trends in Agricultural Production and Infrastructure Highlights - In many states the percentage of the state population designated by the U.S. Census Bureau as living in rural areas has declined,

More information

Economic Analysis of the TV Advertising Market. Preface

Economic Analysis of the TV Advertising Market. Preface of the TV Advertising Market Preface This report, commissioned by Ofcom from, combines the latest econometric modelling techniques with industry thinking and expertise to build an economic model of the

More information

Risk Budgeting: Concept, Interpretation and Applications

Risk Budgeting: Concept, Interpretation and Applications Risk Budgeting: Concept, Interpretation and Applications Northfield Research Conference 005 Eddie Qian, PhD, CFA Senior Portfolio Manager 60 Franklin Street Boston, MA 00 (67) 439-637 7538 8//005 The Concept

More information

Question 1a of 30. Question 1b of 30. Question 1c of 30. Exam: U.S. and Global Economics

Question 1a of 30. Question 1b of 30. Question 1c of 30. Exam: U.S. and Global Economics Exam: U.S. and Global Economics Question 1a of 30 ( 1 The game of economics 242917 ) Question: Economic decisions involve doing what with resources to produce goods and services for people to consume?

More information

Lecture 15. Ranking Payoff Distributions: Stochastic Dominance. First-Order Stochastic Dominance: higher distribution

Lecture 15. Ranking Payoff Distributions: Stochastic Dominance. First-Order Stochastic Dominance: higher distribution Lecture 15 Ranking Payoff Distributions: Stochastic Dominance First-Order Stochastic Dominance: higher distribution Definition 6.D.1: The distribution F( ) first-order stochastically dominates G( ) if

More information

INTRINSIC LIQUIDITY VALUE FOR NON-PROFIT ORGANIZATIONS 1

INTRINSIC LIQUIDITY VALUE FOR NON-PROFIT ORGANIZATIONS 1 Economics, Management, and Financial Markets Volume 6(1), 2011, pp. 1012 1019, ISSN 1842-3191 INTRINSIC LIQUIDITY VALUE FOR NON-PROFIT ORGANIZATIONS 1 GRZEGORZ MICHALSKI Grzegorz.Michalski@ue.wroc.pl Wroclaw

More information

Elasticity of long distance travelling

Elasticity of long distance travelling Young Researchers Seminar 2011 Young Researchers Seminar 2011 DTU, Denmark, 8 10 June, 2011 DTU, Denmark, June 8-10, 2011 Elasticity of long distance travelling Mette Aagaard Knudsen DTU Transport Outline

More information

The UK betting and gaming market: estimating price elasticities of demand and understanding the use of promotions

The UK betting and gaming market: estimating price elasticities of demand and understanding the use of promotions The UK betting and gaming market: estimating price elasticities of demand and understanding the use of promotions A REPORT PREPARED FOR HM REVENUE AND CUSTOMS June 2014 Frontier Economics Ltd, London.

More information

Markets. Chapter MOBILES GO GLOBAL LEARNING OBJECTIVES

Markets. Chapter MOBILES GO GLOBAL LEARNING OBJECTIVES Markets LEARNING OBJECTIVES LO 3.1 LO 3.2 LO 3.3 LO 3.4 LO 3.5 LO 3.6 LO 3.7 Identify the defining characteristics of a competitive market. Draw a demand curve and describe the external factors that determine

More information

Lesson 1. Net Present Value. Prof. Beatriz de Blas

Lesson 1. Net Present Value. Prof. Beatriz de Blas Lesson 1. Net Present Value Prof. Beatriz de Blas April 2006 1. Net Present Value 1 1. Introduction When deciding to invest or not, a rm or an individual has to decide what to do with the money today.

More information

ECO364 - International Trade

ECO364 - International Trade ECO364 - International Trade Chapter 2 - Ricardo Christian Dippel University of Toronto Summer 2009 Christian Dippel (University of Toronto) ECO364 - International Trade Summer 2009 1 / 73 : The Ricardian

More information

Contents. List of Figures... 11. List of Variables and Abbreviations... 13. Introduction... 19

Contents. List of Figures... 11. List of Variables and Abbreviations... 13. Introduction... 19 Contents List of Figures... 11 List of Variables and Abbreviations... 13 Introduction... 19 Chapter 1. Stylised Facts of Saving Paragraph 1.1 Data Sets and Statistical Issues... 33 1.1.1 Various Saving

More information

Current Issues in U.S. Health Economics: Summary for Health Economics Course (ECN 132)

Current Issues in U.S. Health Economics: Summary for Health Economics Course (ECN 132) Current Issues in U.S. Health Economics: Summary for Health Economics Course (ECN 132) Colin Cameron Department of Economics U.C. Davis http://www.econ.ucdavis.edu/faculty/cameron Revised March 2013 The

More information

The Relationship between Electricity Prices and Electricity Demand, Economic Growth, and Employment DRAFT REPORT

The Relationship between Electricity Prices and Electricity Demand, Economic Growth, and Employment DRAFT REPORT The Relationship between Electricity Prices and Electricity Demand, Economic Growth, and Employment DRAFT REPORT Prepared for: Kentucky Department for Energy Development and Independence Coal Education

More information

Problem Set II: budget set, convexity

Problem Set II: budget set, convexity Problem Set II: budget set, convexity Paolo Crosetto paolo.crosetto@unimi.it Exercises will be solved in class on January 25th, 2010 Recap: Walrasian Budget set, definition Definition (Walrasian budget

More information

Spring 2015: Gordon State College. Barnesville, GA Online Course: Econ 2106 Microeconomics. Course Meeting Time and Location: Internet (D2L)

Spring 2015: Gordon State College. Barnesville, GA Online Course: Econ 2106 Microeconomics. Course Meeting Time and Location: Internet (D2L) Spring 2015: Gordon State College. Barnesville, GA Online Course: Econ 2106 Microeconomics Course Meeting Time and Location: Internet (D2L) Tentative Syllabus- will have some changes as semester begins

More information

Measuring Beef Demand

Measuring Beef Demand Measuring Beef Demand James Mintert, Ph.D. Professor & Extension State Leader Department of Agricultural Economics Kansas State University www.agmanager.info/livestock/marketing jmintert@ksu.edu A Picture

More information

How Securities Are Traded

How Securities Are Traded How Securities Are Traded What is this project about? You will learn how securities are traded on exchanges, particularly how to conduct margin trades, short sales, and submit limit orders. What case do

More information

I. Basic concepts: Buoyancy and Elasticity II. Estimating Tax Elasticity III. From Mechanical Projection to Forecast

I. Basic concepts: Buoyancy and Elasticity II. Estimating Tax Elasticity III. From Mechanical Projection to Forecast Elements of Revenue Forecasting II: the Elasticity Approach and Projections of Revenue Components Fiscal Analysis and Forecasting Workshop Bangkok, Thailand June 16 27, 2014 Joshua Greene Consultant IMF-TAOLAM

More information

ECO 352 Spring 2010 No. 7 Feb. 23 SECTOR-SPECIFIC CAPITAL (RICARDO-VINER) MODEL

ECO 352 Spring 2010 No. 7 Feb. 23 SECTOR-SPECIFIC CAPITAL (RICARDO-VINER) MODEL ECO 352 Spring 2010 No. 7 Feb. 23 SECTOR-SPECIFIC CAPITAL (RICARDO-VINER) MODEL ASSUMPTIONS Two goods, two countries. Goods can be traded but not factors across countries. Capital specific to sectors,

More information

SAVI TRADING 2 KEY TERMS AND TYPES OF ORDERS. SaviTrading LLP 2013

SAVI TRADING 2 KEY TERMS AND TYPES OF ORDERS. SaviTrading LLP 2013 SAVI TRADING 2 KEY TERMS AND TYPES OF ORDERS 1 SaviTrading LLP 2013 2.1.1 Key terms and definitions We will now explain and define the key terms that you are likely come across during your trading careerbefore

More information

IOWA End-of-Course Assessment Programs. Released Items ALGEBRA I. Copyright 2010 by The University of Iowa.

IOWA End-of-Course Assessment Programs. Released Items ALGEBRA I. Copyright 2010 by The University of Iowa. IOWA End-of-Course Assessment Programs Released Items Copyright 2010 by The University of Iowa. ALGEBRA I 1 Sally works as a car salesperson and earns a monthly salary of $2,000. She also earns $500 for

More information

Modelling farmer participation to a revenue insurance scheme by the means of the Positive Mathematical Programming

Modelling farmer participation to a revenue insurance scheme by the means of the Positive Mathematical Programming Modelling farmer participation to a revenue insurance scheme by the means of the Positive Mathematical Programming Raffaele CORTIGNANI, Simone SEVERINI DAFNE, University of Tuscia, Viterbo, Italy Abstract:

More information

What you will learn: UNIT 3. Traditional Flow Model. Determinants of the Exchange Rate

What you will learn: UNIT 3. Traditional Flow Model. Determinants of the Exchange Rate What you will learn: UNIT 3 Determinants of the Exchange Rate (1) Theories of how inflation, economic growth and interest rates affect the exchange rate (2) How trade patterns affect the exchange rate

More information

An Econometric Assessment of Electricity Demand in the United States Using Panel Data and the Impact of Retail Competition on Prices

An Econometric Assessment of Electricity Demand in the United States Using Panel Data and the Impact of Retail Competition on Prices 9 June 2015 An Econometric Assessment of Electricity Demand in the United States Using Panel Data and the Impact of Retail Competition on Prices By Dr. Agustin J. Ros This paper was originally presented

More information

A Primer on Forecasting Business Performance

A Primer on Forecasting Business Performance A Primer on Forecasting Business Performance There are two common approaches to forecasting: qualitative and quantitative. Qualitative forecasting methods are important when historical data is not available.

More information

Fundamentals Level Skills Module, Paper F5

Fundamentals Level Skills Module, Paper F5 Answers Fundamentals Level Skills Module, Paper F5 Performance Management June 2014 Answers 1 (a) Full budgeted production cost per unit using absorption costing Product X Y Z Total Budgeted annual production

More information

4. College of Business

4. College of Business The University of Texas at San Antonio 1 4. College of Business Mission Statement The College of Business is dedicated to creating and sharing knowledge that enhances the translation of theory to practice.

More information

Optimal Health Insurance for Prevention and Treatment

Optimal Health Insurance for Prevention and Treatment Optimal Health Insurance for Prevention and Treatment Randall P. Ellis Department of Economics Boston University Willard G. Manning Harris School of Public Policy Studies The University of Chicago We thank

More information

NBER WORKING PAPER SERIES PRICE ELASTICITY OF DEMAND FOR TERM LIFE INSURANCE AND ADVERSE SELECTION

NBER WORKING PAPER SERIES PRICE ELASTICITY OF DEMAND FOR TERM LIFE INSURANCE AND ADVERSE SELECTION NBER WORKING PAPER SERIES PRICE ELASTICITY OF DEMAND FOR TERM LIFE INSURANCE AND ADVERSE SELECTION Mark V. Pauly Kate H. Withers Krupa Subramanian-Viswanathan Jean Lemaire John C. Hershey Katrina Armstrong

More information

CONTENTS MODULE 1: INDUSTRY OVERVIEW 4 MODULE 2: ETHICS AND REGULATION 6 MODULE 3: INPUTS AND TOOLS 8 MODULE 4: INVESTMENT INSTRUMENTS 12

CONTENTS MODULE 1: INDUSTRY OVERVIEW 4 MODULE 2: ETHICS AND REGULATION 6 MODULE 3: INPUTS AND TOOLS 8 MODULE 4: INVESTMENT INSTRUMENTS 12 SYLLABUS OVERVIEW 1 CONTENTS MODULE 1: INDUSTRY OVERVIEW 4 CHAPTER 1 The Investment Industry: A Top-Down View MODULE 2: ETHICS AND REGULATION 6 CHAPTER 2 CHAPTER 3 Ethics and Investment Professionalism

More information

Supply and demand. Supply and demand. Roll the phrase around in your

Supply and demand. Supply and demand. Roll the phrase around in your 4 Supply and Demand After reading this chapter, you should be able to: 1. Explain the law of demand and what it implies. a. Distinguish a change in demand from a change in quantity demanded. b. Draw a

More information

(c) 2006-2014 Gary R. Evans. May be used for non-profit educational purposes only without permission of the author.

(c) 2006-2014 Gary R. Evans. May be used for non-profit educational purposes only without permission of the author. The futures markets Introduction and Mechanics (c) 2006-2014 Gary R. Evans. May be used for non-profit educational purposes only without permission of the author. Forward contracts... Forward contracts

More information

Math 370, Spring 2008 Prof. A.J. Hildebrand. Practice Test 2 Solutions

Math 370, Spring 2008 Prof. A.J. Hildebrand. Practice Test 2 Solutions Math 370, Spring 008 Prof. A.J. Hildebrand Practice Test Solutions About this test. This is a practice test made up of a random collection of 5 problems from past Course /P actuarial exams. Most of the

More information

I Want My. MTV and My CNN. The Cable TV Industry and Regulation. and My ESPN. A Cable Retrospective. Glossary of Cable TV Terms

I Want My. MTV and My CNN. The Cable TV Industry and Regulation. and My ESPN. A Cable Retrospective. Glossary of Cable TV Terms The Regional Economist July 1995 I Want My by Adam M. Zaretsky MTV and My CNN and My ESPN and My TBS and... The Cable TV Industry and Regulation A s if editing a movie once again because the last cut was

More information

Official Order ofthe Commissioner of Insurance. State of Texas. Austin, Texas

Official Order ofthe Commissioner of Insurance. State of Texas. Austin, Texas No. 09-0691 Subject Considered: Official Order ofthe Commissioner of Insurance ofthe State of Texas Austin, Texas Date: AUG 19 2009 RATE CHANGES FOR PRIVATE PASSENGER AND COMMERCIAL AUTOMOBILE INSURANCE

More information

THE U.S. HOUSEHOLD SAVINGS RATE AND CONSUMPTION 3 March 2009, additions 4 March see http://www.closemountain.com/publications.

THE U.S. HOUSEHOLD SAVINGS RATE AND CONSUMPTION 3 March 2009, additions 4 March see http://www.closemountain.com/publications. THE U.S. HOUSEHOLD SAVINGS RATE AND CONSUMPTION 3 March 2009, additions 4 March see http://www.closemountain.com/publications.html for updates T. S. Coleman PhD Close Mountain Advisors www.closemountain.com

More information

EU Milk Margin Estimate up to 2014

EU Milk Margin Estimate up to 2014 Ref. Ares(215)2882499-9/7/215 EU Agricultural and Farm Economics Briefs No 7 June 215 EU Milk Margin Estimate up to 214 An overview of estimates of of production and gross margins of milk production in

More information

Florida Math for College Readiness

Florida Math for College Readiness Core Florida Math for College Readiness Florida Math for College Readiness provides a fourth-year math curriculum focused on developing the mastery of skills identified as critical to postsecondary readiness

More information

Math 2413. Calculus I with Analytical Geometry Online Mathematics Department

Math 2413. Calculus I with Analytical Geometry Online Mathematics Department Math 2413. Calculus I with Analytical Geometry Online Mathematics Department Rita Marie O Brien WCB 108/(903) 875 7510 ritamarie.obrien@navarrocollege.edu Summer 2009 1) Catalog Description of the Course:

More information

FOREIGN TAXES AND THE GROWING SHARE OF U.S. MULTINATIONAL COMPANY INCOME ABROAD: PROFITS, NOT SALES, ARE BEING GLOBALIZED.

FOREIGN TAXES AND THE GROWING SHARE OF U.S. MULTINATIONAL COMPANY INCOME ABROAD: PROFITS, NOT SALES, ARE BEING GLOBALIZED. National Tax Journal, June 2012, 65 (2), 247 282 FOREIGN TAXES AND THE GROWING SHARE OF U.S. MULTINATIONAL COMPANY INCOME ABROAD: PROFITS, NOT SALES, ARE BEING GLOBALIZED Harry Grubert The foreign share

More information

The Supply of Medical Care, The Market for Health Insurance and Market Competition. Lecture 25. Economics 157 Health Economics Summer 2003

The Supply of Medical Care, The Market for Health Insurance and Market Competition. Lecture 25. Economics 157 Health Economics Summer 2003 The Supply of Medical Care, The Market for Health Insurance and Market Competition Lecture 25 Economics 157 Health Economics Summer 2003 Lectures 25; Graphic 25 No. 1 Announcements (1) Tuesday 080503:

More information

RETAILERS ATTITUDES TOWARDS CROSS- BORDER TRADE AND CONSUMER PROTECTION

RETAILERS ATTITUDES TOWARDS CROSS- BORDER TRADE AND CONSUMER PROTECTION Eurobarometer RETAILERS ATTITUDES TOWARDS CROSS- BORDER TRADE AND CONSUMER PROTECTION REPORT Fieldwork: September - October 2012 Publication: June 2013 This survey has been requested by the European Commission,

More information

Business Cost Comparison

Business Cost Comparison Business Cost Comparison LaGrange, Georgia vs. Auburn, Alabama TABLE OF CONTENTS PROJECT MANAGER CONTACT INFORMATION: Lonnie Smallwood Business Development Associate ECG - Economic & Community Development

More information

Taxation and Its Effect Upon Public and Private Health Insurance and Medical Demand

Taxation and Its Effect Upon Public and Private Health Insurance and Medical Demand Taxation and Its Effect Upon Public and Private Health Insurance and Medical Demand by Nancy T. Greenspan and Ronald J. Vogel Multiple tax subsidies are available to many buyers and sellers of health insurance.

More information

Topics Today (2/6/14)

Topics Today (2/6/14) Topics Today (2/6/14) Approaches to correct for externalities Government can make things worse last time and today The Coase Theorem today Other approaches future lectures The economics of pollution control

More information

DEMANDING SUPPLY: MIXED HEALTHCARE FINANCING IN AUSTRALIA

DEMANDING SUPPLY: MIXED HEALTHCARE FINANCING IN AUSTRALIA DEMANDING SUPPLY: MIXED HEALTHCARE FINANCING IN AUSTRALIA Master s thesis in Health Economics August 2014 By: Joshua Kraindler Supervisor: Carl Hampus Lyttkens 1 ABSTRACT This paper will analyse the financial

More information

Relative prices and Balassa Samuleson e ect

Relative prices and Balassa Samuleson e ect Relative prices and Balassa Samuleson e ect Prof. Ester Faia, Ph.D. Johann Wolfgang Goethe Universität Frankfurt a.m. March 2009 rof. Ester Faia, Ph.D. (Johann Wolfgang Goethe Relative Universität prices

More information

Table of Contents. Human Resource Plan 27. The Business Plan 3

Table of Contents. Human Resource Plan 27. The Business Plan 3 Table of Contents The Business Plan 3 Human Resource Plan 27 Structuring Your Plan 5 Title Page 5 Table of Contents 6 Executive Summary 6 Business Description 7 Materials/ Supplies 28 Production 29 Quality

More information

Example 1: Suppose the demand function is p = 50 2q, and the supply function is p = 10 + 3q. a) Find the equilibrium point b) Sketch a graph

Example 1: Suppose the demand function is p = 50 2q, and the supply function is p = 10 + 3q. a) Find the equilibrium point b) Sketch a graph The Effect of Taxes on Equilibrium Example 1: Suppose the demand function is p = 50 2q, and the supply function is p = 10 + 3q. a) Find the equilibrium point b) Sketch a graph Solution to part a: Set the

More information

FCStone Grain Recap October 1, 2015

FCStone Grain Recap October 1, 2015 CORN: A choppy but firm market today. Today starts the march of the private crop estimates led off with FCStone s number this afternoon. Export sales reported today showed net bookings of 748.2 tmt as

More information

Recitation #4 Week 02/02/2009 to 02/08/2009 Chapter 5: The Market Strikes Back

Recitation #4 Week 02/02/2009 to 02/08/2009 Chapter 5: The Market Strikes Back Recitation #4 Week 02/02/2009 to 02/08/2009 Chapter 5: The Market Strikes Back Problems and Exercises 1. A price ceiling is implemented in the market for housing in Metropolitan City, where all housing

More information

The Specific-Factors Model: HO Model in the Short Run

The Specific-Factors Model: HO Model in the Short Run The Specific-Factors Model: HO Model in the Short Run Rahul Giri Contact Address: Centro de Investigacion Economica, Instituto Tecnologico Autonomo de Mexico (ITAM). E-mail: rahul.giri@itam.mx In this

More information

Poverty and income growth: Measuring pro-poor growth in the case of Romania

Poverty and income growth: Measuring pro-poor growth in the case of Romania Poverty and income growth: Measuring pro-poor growth in the case of EVA MILITARU, CRISTINA STROE Social Indicators and Standard of Living Department National Scientific Research Institute for Labour and

More information

CCP CLEARING OF SEK DENOMINATED REPOS

CCP CLEARING OF SEK DENOMINATED REPOS Repoclearing CCP CLEARING OF SEK DENOMINATED REPOS Product specification Facts Type of contract: Buy/sell-back of a specific Contract base: The nominal amount shall be one million Swedish Kronor for each

More information

EMPIRICAL MACRO PRODUC TION FUNCTIONS SOME METHODOLOGICAL

EMPIRICAL MACRO PRODUC TION FUNCTIONS SOME METHODOLOGICAL - SaBHBBI ^ m v > x S EMPIRICAL MACRO PRODUC TION FUNCTIONS SOME METHODOLOGICAL COMMENTS by Sören Wibe Umeå Economic Studies No. 153 UNIVERSITY OF UMEÅ 1985 ISSN 0348-1018 - 1 - EMPIRICAL MACRO PR ODUCTION

More information