Formulas for microeconomics midterm

Derivatives: d(yz)/dx = y(dz/dx) + z(dy/dx)

dxn/dx = nxn-1

Slope of a line y(x): dy/dx

Approximate slope of a line

between points (x1, y1) and (x2, y2): (y2 - y1)/(x2 – x1)

Slope of a straight line y = a + bx: dy/dx = b

Budget line: xpx + ypy = I

Slope of budget line: -px/py

Marginal rate of substitution: MRS = -MUx/MUy

Price elasticity of demand: ep = (dQ/Q)/(dP/P) = (dQ/dP)(P/Q)

Income elasticity of demand: eI = (dQ/Q)/(dI/I) = (dQ/dI)(I/Q)

Cross elasticity of demand: exy = (dx/x)/(dPy/Py) = (dx/dPy)(Py/x)

Cost formulas: C(q) = F + V(q)

ATC(q) = F/q + AVC(q)
MC(q) = dC/dq = dV/dq

Profit maximization: MR(q) = MC(q)

Marginal revenue of monopolist: MR = p + q(dp/pq) = p(1 + 1/ep)