...–living components of an ecosystem • Abiotic factors-non-living components of an ecosystem e.g. rainfall Giving example, I will describe the effects biotic and abiotic factors will have on the dynamic equilibrium of populations. As previously defined, abiotic factors are non-living components of an ecosystem, which include temperature. For instance, the reproduction of the Leather back turtle is affected by rising temperature of the beach sand, in which it lays its eggs. This increase in temperature causes dramatic imbalances in the sex ratios of hatchlings. This will affect the dynamic equilibrium of the population as the imbalance in sex ratio could cause birth rate to decline, as individuals are unable to find a mate due to the imbalance. Another abiotic factor is PH of soil or water. For instance, clownfish are greatly affected by a decrease in PH in ocean water (oceanic acidification). This change in PH affects their sense of smell thus impede their ability to search for the sea anemones in which they live and depend for protection from predators. This will likely lead to an increase of death rate as clownfish will be unable to find a suitable habitat and unable to hide safely from predators. Therefore showing that the PH of water can affect the population’s dynamic equilibrium. Additionally, another type of abiotic factor is pollution. Pollution can come in many forms, such as air, water and noise pollution and affects many different animals greatly. For instance, because...
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...Questions 1 As seen from the excel sheet we conclude that the NVP for Project 1 results in negative amounts, as a result we do not choose project 1. As for project 2 amongst the two options we will choose Project two with DR at 10% as it yields a higher NVP value. Question 2 a) What is the equilibrium price and quantity of fertilizer in an unregulated, competitive market? 6 tons per day b) What is the efficient quantity of fertilizer? 4 tons per day c) Suppose government imposes a tax equal to the marginal external cost. What is the equilibrium price paid by consumers and the equilibrium quantity after implementation of the tax? Consumers will pay $1,200 per ton, and the efficient level of output at 4 tons per day will be achieved. d) At the output level in part (6), how much is the tax per one ton? $1200 - $800 = $400 e) How much tax revenue does government collect? $400 per ton x 4 tons per day = $1,600 per day f) What is the deadweight loss borne by society if the externality is left uncorrected? (6-4)x(1,600-1,000)/2 = $600 Question 3 a) According to Coase theorem it doesn’t matter who builds the fence as long as it is less than the cost of the crop damage. However, to answer the question; the rancher builds the fence, because the cost of the fence ($100) is less than the cost of compensating the farmer for crop damage. Together, the rancher and the farmer are $200 better off ($300 crop damage less $100...
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...Risk in Housing Markets: An Equilibrium Approach⇤ Aurel Hizmo† NYU Stern January 30, 2012 Abstract Homeowners are overexposed to city-specific house price risk and income risks, which may be very di cult to insure against using standard financial instruments. This paper develops a micro-founded equilibrium model that transparently shows how this local uninsurable risk a↵ects individual location decisions and portfolio choices, and ultimately how it a↵ects prices in equilibrium. I estimate a version of this model using house price and wage data and provide estimates for risk premia for di↵erent cities, which imply that homes are on average about $20000 cheaper than they would be if owners were risk-neutral. This estimate is over $100000 for volatile coastal cities. Next, I simulate the model to study the e↵ects of financial innovation on equilibrium outcomes. Creating assets that hedge city-specific risks increases house prices by about 20% and productivity by about 10%. The average willingness to pay for completing the market per homeowner is between $10000 and $20000. Welfare gains come both from better risk-sharing and from more e cient sorting of households across cities. ⇤ I am deeply grateful to Patrick Bayer, Andrew Patton, and Peter Arcidiacono for their encouragement and support. I also thank Robert McMillan, Tim Bollerslev, Vish Viswanathan, Chris Timmins, Jimmy Roberts and the seminar participants at Duke Finance, the ERID Conference at Duke, Fed Board, NYU Stern...
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...Tournaments and Piece Rates Revisited: A Theoretical and Experimental Study of Premium Incentives Werner Guth Rene Levnsky Kerstin Pully Ori Weiselz June 22, 2010 Abstract Tournaments represent an increasingly important component of organizational compensation systems. While prior research focused on xed-prize tournaments, i.e., on tournaments where the prize or prize sum to be awarded is set in advance, we introduce a new type of tournament into the literature: premium incentives. While premium incentives, just like xed-prize tournaments, are based on relative performance, the prize to be awarded is not set in advance but is a function of the rm's success: the prize is high if the rm is successful and low if it is not successful. Relying on a simple model of cost minimization, we are able to show that premium incentives outperform xed-prize tournaments as well as piece rates. Our theoretical result is qualitatively con rmed by a controlled laboratory experiment and has important practical implications for the design of organizational incentive systems. JEL Classi cation: C72, C91, J33 Keywords: Tournaments, Incentives, Economic experiments Max Planck Institute for Economics, Kahlaische Strasse 10, 07745 Jena, Germany. yEberhard Karls Universitat Tubingen, Faculty of Economics and Business Administration, Nauklerstrasse 47, 72074 Tubingen, Germany. zThe Hebrew University, Center for the Study of Rationality, Giv'at Ram, Jerusalem 91904, Israel...
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...observers contended, however, that the management scientists were proposing changes with insufficient regard for relevance, timeliness, acceptance, or implementation (Zand, 1975). Identifying the Characteristics of Effective Organizational Change Psychologist Kurt Lewin theory on organizational change conceptualized the present condition or level of activity of a system as a dynamic social equilibrium, that is a state of balance maintained by active driving and resisting social forces. Change then consisted of altering the driving and resisting forces thereby facilitating the movement of the system to a new level of equilibrium (Zand, 1975). Lewin conceptualized change as a process with three phases: (1) unfreezing—behavior that increases the receptivity of the client system to a possible change in the distribution and balance of social forces; (2) moving—altering the magnitude, direction, or number of driving and resisting forces, consequently shifting the equilibrium to a new level; and (3) refreezing—reinforcing the new distribution of forces, thereby maintaining and stabilizing the new social equilibrium. Lewin also suggested that although common sense might lean toward increasing driving forces to induce change, in many instances this might arouse an equal and opposite increase in resisting forces, the net effect being no change and greater tension than before (Spector, 2010). The Situation at Asda...
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...list of Frequently Used Symbols and Notation A text such as Intermediate Financial Theory is, by nature, relatively notation intensive. We have adopted a strategy to minimize the notational burden within each individual chapter at the cost of being, at times, inconsistent in our use of symbols across chapters. We list here a set of symbols regularly used with their specific meaning. At times, however, we have found it more practical to use some of the listed symbols to represent a different concept. In other instances, clarity required making the symbolic representation more precise (e.g., by being more specific as to the time dimension of an interest rate). Roman Alphabet a Amount invested in the risky asset; in Chapter 14, fraction of wealth invested in the risky asset or portfolio AT Transpose of the matrix (or vector)A c Consumption; in Chapter 14 only, consumption is represented by C, while c represents ln C ck Consumption of agent k in state of nature θ θ CE Certainty equivalent CA Price of an American call option CE Price of a European call option d Dividend rate or amount ∆ Number of shares in the replicating portfolio (Chapter xx E The expectations operator ek Endowment of agent k in state of nature θ θ f Futures position (Chapter 16); pf Price of a futures contract (Chapter 16) F, G Cumulative distribution functions associated with densities: f, g Probability density functions K The strike or exercise price of an option K(˜) Kurtosis of the random variable x x ˜ L A lottery...
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...Market Equilibration Process Jeremiah D. Wood ECO/561 April 19, 2014 Professor John Lindvall Market Equilibration Process Economic equilibrium is defined as a condition or state in which the economic forces are at a balance. In this particular discussion, one will discuss equilibration, the process of moving between two different points that is affected by a change in demand or supply. One will cover how a specific world event, Hurricane Katrina, caused home prices in Baton Rouge, Louisiana to fluctuate between two equilibrium states. Also to be covered is how the process of said movement occurred using the behaviors of both supply firms and consumers. In the late summer of 2005, Hurricane Katrina bared down on the City of New Orleans and the surrounding areas. This storm caused a surge that caused the storm levees to break that in turn, flooded the City of New Orleans and took most of the city’s housing with it. Because of the destruction, about two hundred and fifty thousand people were relocated to nearby Baton Rouge, making it the largest city in Louisiana. Let us start the discussion by stating that the average price of a single-family home in Baton Rouge before Katrina was one hundred thirty thousand dollars, shown by point A on the graph (O'Sullivan & Sheffrin, 2002). With the explosion of the population, the average price jumped to one hundred and fifty six thousand dollars within six months, point B, and the market shrunk from three thousand six...
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...The theory of market equilibrium states that market forces tend toward a balance, or equilibrium, of price and quantity, unless an outside source intervenes to disrupt the balance (University of Phoenix, 2010). The product I will be discussing is the Apple iPhone and how it reaches its market equilibrium. Apple goes through three phases when releasing inventory to stores (through personal experience.) The first phase is to release a lot of inventory on the day of release. The second phase is slowly release inventory to keep demand up. The third phase is release enough inventory so that all stores have supplies readily available. By being strategic with the quantity of iPhones released Apple set their own market equilibrium. Demand is a schedule that shows the various amounts of a product that consumers are willing and able to buy at each specific price in a series of possible prices during a specified time period (McConnell, Brue, & Flynn, 2009). This demand on a product is greatly affected by supply, which is a schedule that shows amounts of a product a producer is willing and able to produce and sell at each specific price in a series of possible prices during a specified time period (McConnell, Brue, & Flynn, 2009). When the iPhone first releases every Apple and AT&T store receive very large amounts of inventory. Most of the customers waiting at the stores will get an iPhone, however, those that did not wait before stores hourse usually will not get a phone. The reason...
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...Terms Hemoglobin Fetal Hemoglobin Dynamic Equilibrium – when rates of forward and reverse reactions are equal, rendering static concentration(s) of reactants and products Kc – Equilibrium constant with respect to concentration in molarity (M) Kp – Equilibrium constant with respect to partial pressures in atmospheres Equilibrium constant – ratio of concentration of products raised to their stoichiometric coefficients divided by reactants raised to their stoichiometric coefficients (reaction quotient) Heterogeneous equilibrium Reaction quotient Le Châtelier’s Principle Concepts Law of Mass Action when aA+bB↔cC+dD Kc=CcDdAaBb when A↔2B, K1=B2A when 2B↔3C, K2=C3B2 A↔2B2B↔3CA↔3C Koverall=C3A nA+2nB↔3nC therefore K'=C3nAnB2n=Kn Heterogeneous reactions – concentrations of pure solids (s) are constant; both pure solids and pure liquids (l) are excluded from equilibrium expression Calculations Equilibrium constant K=CcDdAaBb Equilibrium equation A+2B↔3C, therefore… Kforward=C3AB2 Kreverse=AB2C3 Kreverse=1Kforward Kc=CcDdAaBb PA=ART eq 14.1 Kp=Kc(RT)∆n eq. 14.2 Key Tables/Figures: Table 14.1 Initial and Equilibrium Concentrations for the Reaction H2g+I2g↔2HIg at 445°C Initial | Equilibrium | Equilibrium Constant | H2 H2 | | I2 I2 | | HI HI | | 0.50 | 0.50 | 0.0 | 0.0 | 0.0 | 0.50 | 0.50 | 0.50 | 0.50 | 1.0 | 0.50 | 0.0 | 0.50 | 1.0 | 0.0 | | H2 H2 | | I2 I2 | | HI HI | | 0.11 | 0.11 | 0.78 | 0.055 | 0.055 | 0.39 | 0.165 |...
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...CHEMICAL EQUILIBRIUM Equilibrium occurs when the rate of the forward reaction is equal to the rate of reverse reaction. Concentration of the reactants and the products remain the same. Dynamic equilibrium occurs when the processes do not stop and forward and reverse reactions still continue in both directions at the same rate. A homogeneous reaction is a reaction wherein all the reactants and products are in the same phase e.g. all are gases. A heterogeneous reaction is a reaction wherein all the reactants and products are not in the same phase. If there is no interaction between the system and its surroundings, i.e., a system from which no substances in the reaction can escape, we say it is a closed system. Calculation of the substance amount and concentration at equilibrium We can determine the concentration of the substance by dividing the number of mol of the substance at that stage of the reaction by the volume of the container in dm3, i.e.: c= n/V where c or [ ] = concentration of the substance in mol.dm-3 n = number of mol of the substance V = volume of the container in dm3 It is handy to use a table to determine these values. Example 1 A mixture of 5 mol H2(g) and 6 mol I2(g) are placed in a sealed container of 2 dm3 at a temperature of 4580C. The balanced chemical equation for the reaction is: Equilibrium is reached after a certain time. At equilibrium there is 4mol HI(g) in the container. Calculate the concentrations...
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...Market Equilibrating Process Student Name ECO/561 Date Peter Oburu Market Equilibrating Process Market equilibrium is defined as a state where the quantity supplied matches the quantity demanded (McConnell, Brue, & Flynn, 2009). In case where there is lack of equilibrium a business can be have a surplus or the buyers could face a shortage. The process in which the market adjust to the demands of market buyers and supply of market sellers is know n as the market equilibrating process. If the market price of a good or service is set above market equilibrium price, the demand will be less than the supply and the net effect will be a surplus. On the other hand, the market price of a good or service is set below the market equilibrium price, the demand will be greater than the quantity supplied and the net effect will be a shortage. For a business either of these scenarios can be detrimental, therefore it is very important that a business owner set their price at the market equilibrium, which is the ideal price for both business (suppliers) and the consumers. This paper provides an example of how the market equilibrating process works for a martini lounge. The paper proceeds as follows; first we describe ... then we highlight ... and finally we conclude that ... As the owner of a restaurant, I have to pay very close attention to pricing in an effort to ensure a steady flow of customers and to build profitability. The type of restaurant I own can be classified and...
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...decide simultaneously whether to hunt for a stag or for hare. Each player has a choice between two strategies: (hunt stag, hunt hare). If both hunt stag, each gets half a stag If both hunt hare, each gets one hare If one hunts for hare while the other tries to take a stag, the former will catch a hare and the latter will catch nothing. If we suppose that the utility of catching a stag is 4 and for a hare is 1, then the payoff matrix for the players can be summarised as follows: Stag Hare (2,2) (0,1) (1,0) (1,1) Game theory is concerned with what outcomes arise in equilibrium. An equilibrium outcome is one which consists of a strategy for each player which is that player’s best response to the strategies of all players. An equilibrium is a stable state which holds because no rational player has an incentive to deviate from that state, where a rational player is one who always attempts to maximise their utility from any situation which requires a choice between alternatives. In the...
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...Management Science Summary Definitions by Subject Game theory * Nash equilibrium * In game theory, the Nash equilibrium is a solution concept of a non-cooperative game involving two or more players, in which each player is assumed to know the equilibrium strategies of the other players, and no player has anything to gain by changing only their own strategy. If each player has chosen a strategy and no player can benefit by changing strategies while the other players keep theirs unchanged, then the current set of strategy choices and the corresponding payoffs constitute a Nash equilibrium. * Stated simply, Amy and Wili are in Nash equilibrium if Amy is making the best decision she can, taking into account Wili's decision, and Wili is making the best decision he can, taking into account Amy's decision. Likewise, a group of players are in Nash equilibrium if each one is making the best decision that he or she can, taking into account the decisions of the others. * Pareto efficiency * Pareto efficiency, or Pareto optimality, is a state of allocation of resources in which it is impossible to make any one individual better off without making at least one individual worse off. The term is named after Vilfredo Pareto (1848–1923), an Italian economist who used the concept in his studies of economic efficiency and income distribution.The concept has applications in academic fields such as economics and engineering. * Given an initial allocation of goods among...
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...Game Theory Game A game is a formal description of a strategic situation. Game Theory Game theory is the formal study of decision-making where several players must make choices that potentially affect the interests of the other players. Mixed Strategy A mixed strategy is an active randomization, with given probabilities, that determines the player’s decision. As a special case, a mixed strategy can be the deterministic choice of one of the given pure strategies. Nash Equilibrium A Nash equilibrium, also called strategic equilibrium, is a list of strategies, one for each player, which has the property that no player can unilaterally change his strategy and get a better payoff. Pay-Off A payoff is a number, also called utility, that reflects the desirability of an outcome to a player, for whatever reason. When the outcome is random, payoffs are usually weighted with their probabilities. The expected payoff incorporates the player’s attitude towards risk. Perfect information A game has perfect information when at any point in time only one player makes a move, and knows all the actions that have been made until then. Player A player is an agent who makes decisions in a game. Rationality A player is said to be rational if he seeks to play in a manner which maximizes his own payoff. It is often assumed that the rationality of all players is common knowledge. Strategic form A game in strategic form, also called normal form, is a compact representation of a game...
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...The equilibrium between nitrogen dioxide, NO2, and dinitrogen tetroxide, N2O4, is shown below. 2NO2(g) [pic] N2O4(g) Kc = 0.01 What happens when the volume of a mixture at equilibrium is decreased at a constant temperature? I. The value of Kc increases II. More N2O4 is formed III. The ratio of [pic] decreases A. I and II only B. I and III only C. II and III only D. I, II and III (Total 1 mark) 2. Which statement about chemical equilibria implies they are dynamic? A. The position of equilibrium constantly changes. B. The rates of forward and backward reactions change. C. The reactants and products continue to react. D. The concentrations of the reactants and products continue to change. (Total 1 mark) 3. Methanol may be produced by the exothermic reaction of carbon monoxide gas and hydrogen gas. CO(g) + 2H2(g) [pic] CH3OH(g) ∆HO = –103 kJ (a) State the equilibrium constant expression, Kc, for the production of methanol. ...................................................................................................................................... ...................................................................................................................................... (1) (b) State and explain the effect of changing the following conditions on the amount of methanol present at equilibrium: ...
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