Saturday, October 28, 2006

All right here are a couple.

a) Regarding question 1: I can get something that has all the same terms as eq2 above (note: z1 = zt and z2 = zt+1) by taking the ln of the profit equation ((9.10) in book) and solving for N. The only problem is it also has terms with 'I' and 'pi' in them. How do I get rid of those?

b) From question 3: what is the intuition for c going down when w goes up (eq4 above)?

c) If someone could give me a hint as to what the deal is with question 4, that would be great too.

1 Comments:

At 3:00 PM, October 28, 2006, Blogger Henry said...

I guess it was kind of dumb of me not to optimize it. But I still get a term I don't want. It's an extra (log alpha)/(1-alpha). Why am I dumb now?

 

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