Intro to Demand Theory – How to Manage Constraints

Welcome to the next section following a discussion on utility and indifference curves (preferences of consumers). We are now into a discussion on demand theory; the previous posts are linked chronologically at the bottom of this post. Demand theory wants to explore...

Cobb Douglas Function – Demand Theory

In the past installments from DiscussEconomics on demand theory, now we’re venturing into the graphical and mathematical expressions of the Cobb Douglas demand function. Graphically expressed (utility maximizing) with the assumption well-behaved preferences. The...

Demand Theory – Consumer Choice Problem

Normal, Inferior, Neutral, Luxury, Necessary Goods There are three fundamental questions about a consumer’s consumption response: 1. How will demand change for a good i change in response to a increase or decrease in the price of i? 2. How will demand for good i...
The Economics of Property Law – Coase Law

The Economics of Property Law – Coase Law

Here is an article that deals with Coase laws and the economics of property law. The lack of defined property rights leads to the abuse of certain activities as a result of a differing perceptions regarding how choices affect marginal private benefits and social...

Introduction to Microeconomics Cost Formulas

Let’s carry on from our introduction into microeconomics with a focus now on how firm’s costs vary with output in the short run (6months to 2 years). Let’s Make an Important Assumption: Prices of inputs are assumed given (ie., firms can’t...
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