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Hal R. Varian Theodore C. Bergstrom James E. W
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Hal R. Varian f f
Theodore C. Bergstrom f f
f James E. West f f
W•W• NORTON &COMPANY • NEWYORK • LONDON
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,W. W. Norton & Company has been independent since its founding in 1923, when William Warder
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f Norton and Mary D. Herter Norton first published lectures delivered at the People’s Institute, the adult
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f education division of New York City’s Cooper Union. The firm soon expanded its program beyond the
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f Institute, publishing books by celebrated academics from America and abroad. By midcentury, the two
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f major pillars of Norton’s publishing program—trade books and college texts—were firmly established. In
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f the 1950s, the Norton family transferred control of the company to its employees, and today—with a staff
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f of four hundred and a comparable number of trade, college, and professional titles published each
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f year—W. W. Norton & Company stands as the largest and oldest publishing house owned wholly by its
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f employees.
Copyright © 2014 by W. W. Norton & Company, Inc. f f f f f f f f f
f All rights reserved.
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Printed in the United States of America. f f f f f f
ISBN 978-0-393-93675-9
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W. W. Norton & Company, Inc.
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500 Fifth Avenue, New York, N.Y. 10110-0017
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W. W. Norton & Company Ltd.
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Castle House, 75/76 Wells Street, London W1T 3QT 1
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,CONTENTS
Preface vii
Part If Test Bank f
Chapter 2 f f f Budget Constraint f 3
Chapter 3 f f f Preferences 11
Chapter 4 f f f Utility 17
Chapter 5 f f f Choice 24
Chapter 6 f f f Demand 32
Chapter 7 f f f Revealed Preference f 41
Chapter 8 f f f Slutsky Equation f 49
Chapter 9 f f f Buying and Selling f f 55
Chapter 10f f f Intertemporal Choice f 65
Chapter 11f f f Asset Markets
f 72
Chapter 12f f f Uncertainty 79
Chapter 13f f f Risky Assets
f 86
Chapter 14f f f Consumer’s Surplus f 89
Chapter 15f f f Market Demand f 94
Chapter 16f f f Equilibrium 105
Chapter 17f f f Measurement 112
Chapter 18f f f Auctions 113
Chapter 19f f f Technology 119
Chapter 20f f f Profit Maximization
f 125
Chapter 21f f f Cost Minimization
f 132
Chapter 22f f f Cost Curves
f 143
Chapter 23f f f Firm Supply
f 150
Chapter 24f f f Industry Supply f 155
Chapter 25f f f Monopoly 162
Chapter 26f f f Monopoly Behavior f 172
, Chapter 27
f f f Factor Markets f 177
Chapter 28
f f f Oligopoly 181
Chapter 29
f f f Game Theory
f 189
Chapter 30
f f f Game Applications
f 195
Chapter 31 f f f Behavioral Economics f 202
Chapter 32
f f f Exchange 207
Chapter 33
f f f Production 217
Chapter 34
f f f Welfare 224
Chapter 35
f f f Externalities 228
Chapter 36
f f f Information Technology f 235
Chapter 37
f f f Public Goods f 239
Chapter 38
f f f Asymmetric Information f 243
Part II
f Alternative Quizzes f
Chapter 2 f f f Budget Constraintf 251
Chapter 3 f f f Preferences 256
Chapter 4 f f f Utility 261
Chapter 5 f f f Choice 266
Chapter 6 f f f Demand 270
Chapter 7 f f f Revealed Preference f 275
Chapter 8 f f f Slutsky Equation f 280
Chapter 9 f f f Buying and Selling
f f 285
Chapter 10
f f f Intertemporal Choice f 290
Chapter 11
f f f Asset Markets
f 294
Chapter 12
f f f Uncertainty 299
Chapter 13
f f f Risky Assets
f 304
Chapter 14 f f f Consumer’s Surplus f 306
Chapter 15
f f f Market Demand f 311
Chapter 16
f f f Equilibrium 315
Chapter 17
f f f Measurement 319