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Friday, May 29, 2009

Exam-Utility Maximization

Introduction
though everyone keep asking how could i was still able to read comics during the final exam but i think i have my own theory here. and though (again) i haven't done any hypothesis testing to ensure this is valid, at least, it worked for me.

Literature review:
Leontief function of labor worked in Keynesian with sticky wages (Scarth, chapter 3, Classical and Keynesian Model) Nmin= Y1,Y2.


Theory:

U = min (S,C)

dU/dS > 0 ; dU/dC > 0

U'' (S) <>subject to 24 hours and leisure (other activities beside studying and comic-ing)


Economic Analysis:
well, i just assumed that during EXAM, utility is leontief function of studying and comic-ing. and the constraint for maximizing the utility is 24 hours per day and leisure time which is other activities beside learning.

i won't explain the maximization but i will explain how the mechanism is. utility is the combination of S and C. When I prefer S, it means the utility of S is very high but at one point it will diminish and the C will give me more utility.


Implication:
What I was doing in last exam was maximizing utility of comic-ing until it diminished and at that time i would need the utility from study-ing.


Empirical evidence and Critique:
The speed of diminishing marginal utility from comic-ing is way too slow--moreover, almost rigid, so it is not U'' (C) > 0 but U'' (C) is infinite. and the speed of diminishing marginal utility is way too fast.




Urrrrghhh. But still, effective then.

4 comments:

MAYANG! said...

kak icha gilaaaaaaak itu apa kak? temuan rumus baru buat dimasukkin ke skripsi yaaa. gilak2, bagus bgt dah kak pengimplementasiannya. aku ngga bisa berkomentar ttg pelajarannya kak, matela sudah cukup kemarin hehe. hebat2.

chaa said...

bisa aja si mayang.

nggak lama lagi juga lo error gini kayak gw.

Jasper12.01u said...

HAHAHHAHAHAHAHA!!!

I TOTALLY agree! :D

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