(8th edition) (the pearson series in economics) robert pindyck, daniel rubinfeld microecon 760

INDEX • 735
Discounted present value, 561, 562
Discount rate
commercial banks and, 589
determination of, 569–570
real vs. nominal, 571–572
risk-adjusted, 575–576
Discounts, quantity, 404
Discrimination, price. See Price
discrimination
Diseconomies of scale, 255–256, 308
Diseconomies of scope, 259
Disequilibrium, market, 608
Disney Channel, 426
Disneyland, 416
Disposable diaper industry, capital
investment in, 576–578
DiTella, Raphael, 81n4
Diversifiable risk, 574–575
Diversification
risk and, 170–171
stock market and, 171
Dividend yields for S&P 500, 184
Dixit, Avinash, 492n5, 516n19, 570n10
Dollar bill game, 489
Dominant firm model, 476–477
Dominant strategy, 490–491
Double marginalization, 442–443
Dranove, David, 176n9
Dreyfus, Mark K., 580n15
Duality, 154–155

Dulberger, Ellen R., 105n15
Duopoly, 458, 462
DuPont, 514–515
Durability
demand and, 40–41
supply and, 45–46
Durable equipment
consumption of, 43
investment in, 42–43
Dutch auction, 517
DVD rentals, effect on movie theater
tickets, 596–597

E
eBay, 522–524
Economic efficiency
bargaining and, 685–686
of competitive markets, 323–328,
609–610
equity and, 610–613
exchange and, 602–610, 624
free trade and, 618–623
market failure and, 625–627
monopolistic competition and,
454–455
production and, 613–618, 624
Economic forecasting, 704–705
Economic inefficiency, moral hazard
and, 645
Economic rent

definition of, 305
factor markets and, 542–544
Economic theories, 5–6

Economies of scale, 255–256
barriers to entry and, 376
learning versus, 262–264
Economies of scope, 258–261
Edgeworth box, 603–604
Education
benefits of, 640–642
college costs and, 13–14, 28
determining spending levels of,
694–695
net present value and, 581
public, 691
Effective yield, bond, 566–567
Efficiency, public goods and, 691–692
Efficiency wage theory, 654–656
Efficient allocations, 602, 604–606
Effluent fees, 247–249
Egalitarian view of equity, 611, 612
Eggs, cost of, 13–14, 28
Elasticity in supply and demand, 33–39,
126–128. See also Price elasticity
advertising and, 431
arc elasticity of demand, 36–37
cross-price elasticity of demand, 35
definition of, 33
income elasticity of demand, 34–35,

40–43
linear demand curve, 34
long-run, 311–312
monopolies and, 376
monopsony and, 385–389
oil and, 56–58
point vs. arc elasticities, 36–37
price markup and, 373
short-run market and, 296–297
short-run vs. long-run elasticities, 39–48
soft drinks and, 370
tax impact on, 347
Electric power, cost functions for, 268–269
Ellerman, A.D., 675n10
Ellerman, Denny, 675n10
Elliott, Kimberly Ann, 622n9
Ellis, Gregory M., 587n21
Elobeid, Amani, 598n1
Emissions
efficient levels of, 668
emissions trading and clear air, 673–675
marginal external costs of, 666
standards vs. fees and, 669–671
stock externalities and, 678–684
sulfur dioxide, 665–666, 672–673
transferable emissions permits, 671–672
Emissions fee, 668–669
Emissions standard, 668
Empty threats, 506
Endowment effect, 190–191

Energy efficiency, 251–253
through capital substitution for labor, 252
through technological change, 252
Energy Independence and Security Act, 17
Engel curves, 116–118
English (or oral) auction, 517
Enomoto, Carl E., 374n9

Entry and exit, competitive equilibrium
and, 300, 302–304
Entry barriers
competitive strategy and, 376
oligopolies and, 456
Entry deterrence, 510–516
Entry fees, 414
Equal marginal principle, 96, 151
Equilibrium, 25–26, 640
competitive, 301–304, 607–609
consumer, 607–609
Cournot equilibrium, 460–461, 464–465
dominant strategies and, 491
exchange efficiency and, 607–609
factor markets and, 542–545
general analysis and, 595–602
labor market, 542–545
long-run, 301–304, 453–454
market changes and, 26–32
Nash equilibrium, 458, 466, 467, 469,
492–498
oligopoly and, 457–458

short-run, 453–454
Stackelberg equilibrium, 492, 492n6
supply and demand and, 25–26
Equilibrium price, 49
Equilibrium quantity, 49
Equitable allocations, 610–613
egalitarian view of, 611, 612
market-oriented view of, 611, 612
perfect competition and, 612–613
Rawlsian view of, 611, 612
social welfare functions and, 611–612
utilitarian view of, 611, 612
utility possibilities frontier and,
610–612
Equity, four views of, 612
Espey, Molly, 44n11
Ethanol global market, 598–600
European antitrust laws, 392
European Merger Control Act, 392
European Union, 392
ex ante forecasts, 704
Excess demand, 58, 608
Excess supply, 608
Exchange economy, defined, 602
Exchange efficiency, 602–610
advantages of trade and, 602–603
competitive equilibrium and, 607–609
contract curve and, 606–607
Edgeworth box and, 603–604
efficient allocations and, 604–606

Excise tax, effects on monopolies, 367
Executive compensation, 647–648
Exhaustible resources, 584–587
Expansion path, 249–251
Expansion strategy, 509
Expected payoff, 495
Expected returns, 178
Expected utility, 165, 195
Expected value, 161
ex post forecasts, 705
Extensive form of a game, 503–504