文档介绍：1 market
market equilibrium
petition:
equilibrium of a 2 sector market, a 2X2X2 model
(1) Equilibrium in a goods market
initial endowment:
Xa+Xb=X,Ya+Yb=Y
or
Xa=X,Ya=Y
MRS: marginal rate of substitution=MUx/MUY
Equilibrium: MRSa=MRSb
(2) equilibrium in a product market
La+Lb=L,Ka+Kb=K
MRTS: marginal rate of technical substitution=MPX/MPY
Equilibrium in production:
MRTSx=MRTSY
(3) General equilibrium
MRT: marginal rate of transformation measures how much product X must be given up in order to increase an additional unit of product Y.
MRT=MCX/MCY
Eqilibrium: MRS=MRT