Linear Equations

Question 1

Example of linear equation

Answer 1

y= ax + b

Question 2

When is an equation solvable?

Answer 2

When a value can be set for y e.g. 0

Question 3

What’s a ‘relation’?

Answer 3

If more than one value of y is possible from just one value of x

Question 4

Budget constraint equation

Answer 4

Y = p1X1 + p2X2

Question 5

3 types of solution for simultaneous equations

Answer 5

1. a unique set of solutions 2. no solutions since the equations represent parallel lines 3. infinitely many solutions since the equations represent the same line

Question 6

At equilibrium Qd =

Answer 6

Qs

Question 7

Equation for per unit tax

Answer 7

P(new)= P(old) + T = P(D)

Question 8

Equation for ad valorem tax

Answer 8

P(new)= P(old) + (1 + t)

Question 9

Gross output

Answer 9

x, y, the total amount of a good produced

Question 10

Net Output

Answer 10

x*, y*, is gross output minus any of the good that is used up as an input

Question 11

x*=x-0.1x-0.2y

y*=y-0.7x-0.4y

What are the inputs and outputs

Answer 11

Outputs

x y

Inputs x 0.1 0.2

y 0.7 0.4