Exam Format

Preparation

I am not directly examining you on any of the pre-midterm content — however given how the course is organized, a good working knowledge of pre-midterm may be necessary to answer the post- midterm content.

For the pre-midterm: Go through the Keywords/Topics from the file I sent out in connection with preparing for the mid-term earlier in the term,  and make sure you know the basic definitions and the conceptual connections between them. Read through the solutions to the various problem sets — in most cases it is simply a matter of recalling what you already learned for the midterm.

For the post-midterm:  Below is a list of keywords/glossary of terms that you should be hitting upon.   Importantly, work through all the problems from Problem Set 6 onwards — by which I mean try to solve the problems on your , see the solutions, then work through the problems on your own again.   Of course, Lectures, Lecture Slides, Quiz 2 and assigned readings are all also important.

Make sure that you have a good understanding of Game Theory part of the course.  In fact a simple check of how well you are prepared  is how well you understand  Repeated Games/Extensive form games (Lec 12) and Lec 13.  That is a good indication of your preparation for the course since those lectures depend on everything that you was done in the prior parts of the course.

Keywords/Topics - Post Midterm

(Check out the midterm-prep advice that I sent out prior to midterm exam for pre-midterm material)

1. Production and Comparative Statics —  see Lec 6 slides, Quiz 2 questions. You should know how to apply  Envelope theorem, use comparative statics propositions/theorems.

2. Expected Utility Hypothesis — Objective vs Subjective beliefs and modeling choice under risk vs. uncertainty.    Indifference curves under expected utility Money lotteries. Attitudes to risk, risk aversion and the shape of the vNM utility function. certainty equivalent and risk.  Arrow-Pratt Measure of Risk Aversion, Demand for insurance.