Exam (elaborations)
Econ 101 Midterm Correct Answers Latest Update
- Course
- ECN 101
- Institution
- Arizona State University
Econ 101 Midterm Correct Answers Latest Update
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Solution 2024/2025Pepper
Econ 101 Midterm Correct Answers Latest
Update
Positive Economics ANS✔✔ description and explanation of economic
phenomena
Normative Economics ANS✔✔ what the economy ought to be like or what
goals of public policy ought to be
Partial Equilibrium Analysis ANS✔✔ how demand and supply are affected by
the price of a particular good in a given market, with the prices of other
goods held fixed
general equilibrium analysis ANS✔✔ how demand and supply conditions
interact in several markets to determine the prices of many goods
economic models ANS✔✔ simplified versions of reality used to analyze real-
world economic situations
consumer theory ANS✔✔ model to describe how individual behave
weak preference ANS✔✔ x is at least as preferred as y ≿
strict preference ANS✔✔ x is more preferred than is y ≻
, Solution 2024/2025
Pepper
indifference ANS✔✔ a lack of interest or concern ∼
Monotonocity ANS✔✔ more is better
convexity ANS✔✔ The slope of the indifference curve gets flatter as good 1
increases. Mixtures of bundles better than extremes.
well-behaved preferences ANS✔✔ M- Monotonicity
C- Completeness
T- Transitivity
R- Reflexivity
S- Strict Convexity
monotonic transformation ANS✔✔ a way of transforming one set of numbers
into another set of numbers in a way that preserves the order of the
numbers
Ordinal vs Cardinal ANS✔✔ Cardinal numbers tell 'how many' of something,
they show quantity. Ordinal numbers tell the order of how things are set,
they show the position or the rank of something.
Cobb-Douglass Utility Function ANS✔✔ u(x₁, x₂) = x₁ᶜx₂ᵈ
Quasilinear Utility Function ANS✔✔ u(x₁, x₂) = f(x₁) + x₂
Perfect substitutes utility function ANS✔✔ u(x₁, x₂) = ax₁ + bx₂
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