Microeconomics 0.0 / 5 ? EconomicsMicroeconomicsUniversityNone Created by: cerysCreated on: 29-11-14 14:54 Consumer Theory Consumers choose best bundle they can afford 1 of 16 Budget Constraint (BC) PxX + PyY < M 2 of 16 Budget Set (BS) All (X,Y) that satisfy BC (BC become PxX + Y = M) 3 of 16 Budget Line (BL) PxX + PyY = M 4 of 16 BL Slope -Px/Py 5 of 16 BL Vertical Intercept M/Py 6 of 16 BL Horizontal Intercept M/Px 7 of 16 Slope of BL Measures how many of y must be given up to gain more of x 8 of 16 Increasing M Parallel shift outwards 9 of 16 Increasing Px Makes BL steeper 10 of 16 Increasing Py Makes BL flatter 11 of 16 Multiply by t Does not change the BL 12 of 16 Per Unit Quantity Tax p + t 13 of 16 Value Tax (ad valorem) p (1+ t) 14 of 16 Per Unit Subsidy p - s 15 of 16 Value Subsidy p (1-s) 16 of 16
Comments
No comments have yet been made