rest that is important Flashcards

1
Q

MRS =

A

MUx/MUy

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2
Q

If MUa/Pa > MUo/Po then

A

buy more a

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3
Q

Types of efficiency:

A
  1. productive - produce at minimum ATC
  2. allocative - produce optimal quantity P = MC
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4
Q

When is TR maximized?

A

When MR = 0

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5
Q

Zero economic profit when

A

ATC=P

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6
Q

Least cost rule

A

MPL/Price of L = MPC/Price of C

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7
Q

Auto safety laws have negative effects

A

Sam Peltzman 1975

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8
Q

The tyranny of the market: Why you cant always get what you want

A

Joel Waldfogel

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9
Q

Theory of liquidity preference

A

John Maynard Keynes

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10
Q

First Nobel in economics

A

1969 Jan Tinbergen and Ragnar Frisch for developing dynamic models

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11
Q

Underinsurance coefficient =

A

sum insured/ current value. (Sum insured/required% x Asset value) x Loss amount

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12
Q

Basis for insurance payment =

A

found damage x coefficient

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13
Q

annual interest rate =

A

(1 + r/n)^n - 1

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14
Q

Taylor rule

A

monetary policy rule on how central banks should set interest rates tying it to inflation and economic growth

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15
Q

Adam Smith 4 tax principles =

A

fairness, certainty, convenience, efficiency

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16
Q

Ad Valorem tax

A

a tax imposed on an item based on its assessed value

17
Q

3 types of money demand

A

transactions, precautionary, speculative

18
Q

The concept of social capital

A

F. Fukayama

19
Q

Whistleblower

A

someone who has and reports insider knowledge

20
Q

Knut Wicksell

A

natural interest rate is when economy is in a stable price equilibrium

21
Q

tax multiplier =

A

1/MPS - 1, MPC/MPS

22
Q

remittance

A

sending money to family abroad

23
Q

Trade policies do not

A

affect trade balance

24
Q

Methodological individualism

A

Max Weber

25
Q

When having situation like 1.02^n = 2 use

A

log1.02 (2) = In(2)/In(1.02)

26
Q

if we need to calculate PV but have more than 1 payment then the present value of annuity

A

PV = P x ((1-(1+r)^-n)/r)
P = payment per period
r = interest rate per period
n = number of periods
If n is large then 1-(1+r)^-n = 1

27
Q

future value of annuity

A

FV = P x ((1+r)^n - 1)/r)

28
Q

expected return on portfolio =

A

W1 x r1 + W2 x r2…..