BEEM101 Microeconomics
Problem Set 2: Choice and consumer preferences
Microeconomics代考 An individual has in mind an ordering of five political candidates from left to right, formally, the set of all candidates is X…
- Exercise – Rationalizability of choice functions (OR Ch. 2, Example 2.2)
An individual has in mind an ordering of five political candidates from left to right, formally, the set of all candidates is X = {C1, C2, C3, C4, C5} with C1 denoting the most left, C2 the second most left, …, and C5 the most right candidate. From any subset of available candidates, if the number of candidates in the subset is odd, she chooses the unique median candidate. If the number of candidates in the subset is even, she chooses the leftmost of the two median candidates. Is her choice function rationalizable?
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Exercise – Indifference curves (OR Ch. 4, P 2) Microeconomics代考
For the preference relations represented by the following utility functions, draw an indifference curve map.
a) u(x1, x2) = min{2x1, x2}
b) u(x1, x2) = x1 − x2
c) u(x1, x2) = 3x1 + x2
3.Exercise – Common assumptions about consumer preferences (OR Ch. 4, P 2)
For the preference relations described in the last problem, determine whether they are (strongly) monotone and (strictly) convex.
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Exercise – Marginal rate of substitution (Varian Ch. 3, RQ 9) Microeconomics代考
What is your MRS of ✩1 bills for ✩5 bills?
- Exercise – Marginal rate of substitution (Varian Ch. 3, RQ 10)
If good 1 is a neutral, what is its MRS expressed in units of good 2?
