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Micro-economic Principles Assignment

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Micro-economic Principles Assignment

This task is intended to assess your knowledge of conventional in micro-economic principles using the most important arguments/explanations with Diagrams illustrations answer each of the following questions. ( 400 word count for each of the following questions)
1. Show that a consumer’s utility maximising bundle equates the marginal rate of substitution to the ratio of the prices of goods (ignore corner solutions).
2. Show why the identification problem makes estimating demand functions difficult.
3. If the only factors of production a firm employs are capital and labour, show that if then the firm is not minimising the cost of producing its output.
Diagrams are essential. It is impossible to produce a good answer to these questions without using a well-chosen, and well-drawn, diagram. Do not simply present a diagram without carefully explaining it in the text. Use diagrams to save words and explain them to illustrate your answer.
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