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Teaching Since: | Apr 2017 |
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MBA, Ph.D in Management
Harvard university
Feb-1997 - Aug-2003
Professor
Strayer University
Jan-2007 - Present
(b) In an equilibrium model the following system of equations is studied: pF’(L)—r:0 pF(L) — TL — B = 0 (*) where F is a twice differentiable function with F '(L) > 0 and F " (L) < 0. All the variables are positive. Consider r and B as exogenous and p and L as endogenous
variables, so that p and L are functions of 'r and B. Find expressions for tap/67",
tap/63, BL/a’r, and ELL/63 by implicit differentiation. Determine, if possible, the signs of these partial derivatives. Show, in particular,
that (9L/6'r < O.
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