Intermediate Microeconomic Theory II Practice

1. Using a diagram to show the effect of a cut in income tax on the consumer's choice (show a consumer's indifference curves (IC) and budget lines (BL)) for an inferior good and a normal goods.

2. Evaluate the possible impact of China's property tax on the economy and society based on the positive and normative.

3. Compare and contrast the derivation of a consumer's demand curve using Marshall's marginal utility analysis with a consumer's demand curve derived by indifference curves.

4. In the competition between the top two automobile firms, General Motors and Ford. GM makes a special offer to sell its vehicles to the general public at the special discount prices enjoyed by its employees for a limited time. Will GM profits be increase regardless of whether the Ford follows? strategy become dominant?

General Motors (GM) Discount GM 210 GM 120 Ford 240 Ford 300 No discount GM 300 GM 240 Ford 150 Ford 270