##### C.9 Experience curve

**Description**This video explains what the experience curve is. We start by learning how to build an experience curve, then we compare two companies competing with the same learning curve, and finally we analyse two particular scenarios.

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The experience curve (not to be confused…

##### C.8 Learning curve

**Description**This video explains what the learning curve is. We start by learning how to build a learning curve, and then we compare two companies competing with the same learning curve.

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The learning curve (not to be confused with experience curve) is a graphical…

##### C.7 Economies of scope

**Description**This video explains what economies of scope are. We analyse how different production possibility frontiers show different types of economies (or diseconomies) of scope.

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The concept of economy of scope is very similar to that of economies of scale. When we talk about…

##### C.6 Subadditivity

**Description**This video explains what subadditivity is. We start with economies of scale for one firm, and then analyse what happens when a second firm enters the market.

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Subadditivity is an important concept because it is often used to justify imperfect competition, the classic…

##### C.5 Economies of scale

**Description**This video explains how economies of scale affect production. We start by explaining how the average cost curve defines when economies of scale appear, and then analyse the difference between economies and diseconomies of scale.

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This economic phenomenon occurs when increasing output is…

##### C.4 Long run cost analysis

**Description**In the long run, no cost is fixed. This video explains how to analyse cost curves in the long run. We’ll see how they form derived from multiple short run cost curves.

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We can determine our production level and adjust plant sizes, investment…

##### B.12 Returns to scale (production in the long run)

**Description**This video introduces the concept of returns to scale, which is needed in order to understand how production processes behave in the long run. Also, it shows what the elasticity of returns of scale is, and how to use it.

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When dealing with…

##### B.11 Production in the short run

**Description**This video explains the basics of production analysis, focusing on the short run. We first learn how to draw the Average and Marginal productivity, and the explain what the output elasticity is.

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The short run is considered the period of time where fixed…

##### B.10 Production duality

**Description**This video shows how useful a good understanding of production duality can be. Starting with production maximisation and cost minimisation, this video explores everything you need to understand about production duality.

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As in consumer’s theory (where consumption duality is analysed), the firm’s input…

##### B.9 Cost minimisation

**Description**This video explains how cost minimisation works when dealing with production, both from the analytical and graphical points of view. We start analysing cost minimisation as the optimisation problem it is, followed by a graphical analysis of the optimum point of production.

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Cost…

##### B.8 Production maximisation

**Description**This video explains how production maximisation works, both from the analytical and graphical points of view. We start analysing production maximisation as the optimisation problem it is, followed by a graphical analysis of the optimum point of production.

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Production maximisation must be seen…

##### B.7 Marginal rate of transformation

**Description**This video explains what the marginal rate of transformation is, and shows its relationship with the production possibility frontier. We also analyse how the marginal rate of transformation determines the opportunity cost in production.

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The marginal rate of transformation can be defined as…

##### A.14 Revealed preference

**Description**This video explains how revealed preference theory works. We’ll learn how to use both the Weak and Strong Axioms of Revealed Preference, in order to derive a utility function from consumer behaviour.

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Revealed preference theory is attributable to Paul Samuelson, who developed the concept in his article “Consumption…

##### C.3 Short run cost analysis

**Description**This video explains how costs behave in the short run, and analyses when a company should start producing.

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In the short run, fixed costs include capital, K, whereas labour, L, is considered variable. Fixed costs are usually represented as a horizontal line and…

##### C.2 Average and marginal cost

**Description**This video explains how average and marginal costs are calculated. Starting from fixed and variable costs, we analyse how average and marginal costs behave.

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Average costs are those associated to one unit of production. Costs per unit grow quicker as production increases, so…

##### C.1 Fixed and variable costs

**Description**This video explains how different types of costs affect the production process. We start by explaining the main characteristics of fixed and variable costs, and how these form total cost. Finally, we explain its relationship with returns to scale.

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When analysing costs, the…

##### B.6 Production possibility frontier

**Description**This video explains how to build and analyse the production possibility frontier. We start by explaining the very basics about the production possibility frontier. Then, we show the relation between the marginal rate of transformation and the production possibility frontier. Finally, we explain how…

##### B.5 Isocosts

**Description**This video shows what isocost lines are, and how important they are when analysing production. We start learning about the budgetary restriction they represent, and explain what happens when the cost of inputs change.

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Isocost lines show combinations of productive inputs that cost…

##### B.4 Marginal rate of technical substitution

**Description**This video explains how to calculate and use the marginal rate of technical substitution. We start by learning how to calculate it, then move on to use it in order to properly draw isoquant curves and, finally, we analyse the marginal rate of technical…

##### B.3 Economic region of production

**Description**This video explains how to determine the economic region of production, using isoquants and isoclines. It also analyses marginal productivity of inputs, and how this may change the production process.

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The economic region of production shows the combinations of factors at a certain…

##### B.2 Isoquants

**Description**With this video, you’ll be able to understand what isoquants are, and how they can help analyse production. You’ll learn the main characteristics of different types of isoquants, as well as what the marginal rate of technical substitution is.

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An isoquant shows the…

##### B.1 Production function

**Description**This video explains how the production function can be built in order to analyse it. We start by explaining the main characteristics of production functions, then show its relationship with returns to scale and, finally, introduce the concept of isoquants.

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A production function…

##### A.13 Characteristics demand

**Description**This video helps understand how characteristics demand works. We start with a simple example, using just two brands. Then, we’ll see what happens when we allow for convex demand curves. Finally, we’ll see how a new brand might change the analysis.

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Characteristics demand…

##### A.12 Paasche index

**Description**This video helps understand how the Paasche index and the equivalent variation work. We start by analyzing the Paasche index analytically, then use a graphical representation to explain what the equivalent variation is.

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Price indices are used to monitor changes in prices levels…

##### A.11 Laspeyres index

**Description**This video helps understand how the Laspeyres index and the compensated variation work. We start by analyzing the Laspeyres index analytically, then use a graphical representation to explain what the compensated variation is.

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Price indices are used to monitor changes in prices levels…

##### A.10 Marshallian and Hicksian demand curves

**Description**This video explains how to build the Marshallian and Hicksian demand curves. We analyse Hicks’ decomposition of the income and substitution effect, from which we derive both demand curves.

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Marshallian and Hicksian demands stem from two ways of looking at the same problem…

##### A.9 Income and substitution effects

**Description**This video explains what the income and substitution effects are, and how to analyse them in order to understand why we buy more goods when their price goes down.

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Generally, if the price of something goes down, we buy more of it. This…

##### A.8 Consumption duality

**Description**This video shows how useful a good understanding of consumption duality can be. Starting with utility maximisation and cost minimisation, this video explores everything you need to understand about consumer theory. We also explain formulas such as Roy’s identity or the Hotelling/Shephard lemma.

A.7 Cost minimisation

**Description**This video explains how cost minimisation works, both from the analytical and graphical points of view. We start analysing cost minimisation as the optimisation problem it is, followed by a graphical analysis of the optimum point of consumption.

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Cost minimisation is a way…

##### A.6 Utility maximisation

**Description**This video explains how utility maximisation works, both from the analytical and graphical points of view. We start analysing utility maximisation as the optimisation problem it is, followed by a graphical analysis of the optimum point of consumption.

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Utility maximisation must be seen…

##### A.5 Budget constraint

**Description**This video explains the very basics of the budget constraint, which is of great importance when dealing with consumption duality. We start by analysing its components, then explain how to draw the budget line and lastly we focus on different factors that can change…

##### A.4 Edgeworth box

**Description**This video explains how to build an Edgeworth box, and how to analyse it. We start from two sets of indifference curves, then build the Edgeworth box and, finally, introduce the contract curve.

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In 1881, Francis Y. Edgeworth came up with a way…

##### A.3 Marginal rate of substitution

**Description**This video explains how to calculate and use the marginal rate of substitution (MRS). We start by learning how to calculate it, then move on to use it in order to properly draw indifference curves and, finally, we analyse the MRS for different kinds…

##### A.2 Indifference curves

**Description**This video explains how indifference curves work and how to build them. We start analysing indifference curves as a way of representing utility, then we explain what the marginal rate of substitution is and, lastly, what different kinds of indifference curves there are.

A.1 Utility function

**Description**This video explains the very basics of consumer’s preferences, and how to successfully build and understand a utility function. We start with basic rationality axioms, then we draw a utility function, and lastly we introduce the concept of indifference curves.

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Utility is the…

##### D.9 Repeated games

**Description**This video shows how repeated games work. By using the prisoner’s dilemma, we analyse how repeated games might have different results depending on whether they have a finite or infinite number of repetitions.

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In game theory, repeated games, also known as supergames, are…

##### D.8 Subgame equilibrium

**Description**This video shows how to look for a subgame perfect equilibrium. We start by explaining what subgames are, then look for a Nash equilibrium, and finally look for the subgame equilibrium.

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In game theory, a subgame is a subset of any game that…

##### D.7 Mixed strategies

**Description**This video shows how mixed strategies work. By using mixed strategies, we will be able to understand how to solve the game known as battle of the sexes.

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Mixed strategies need to be analysed in game theory when there are many possible equilibria,…

##### D.6 Battle of the sexes

**Description**This video explains how the battle of the sexes work. We explain how, by searching for a Nash equilibrium, we won’t be able to solve the game.

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In the battle of the sexes, a couple argues over what to do over the weekend….

##### D.5 Dominant strategies and Nash equilibrium

**Description**This video explains how dominant strategies work, and how to reach a Nash equilibrium. We start by analysing dominant strategies, then explain what the Nash equilibrium is. Finally, we show an example of elimination of dominated strategies.

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Nash equilibria are defined as the…

##### D.4 Battle of the Bismarck Sea

**Description**This video shows how the Battle of the Bismarck Sea works. We start by explaining the military operation, and then see all possible outcomes. Finally, we analyse the game using a game matrix.

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The Battle of the Bismarck Sea was a battle fought…

##### D.3 Prisoner’s dilemma

**Description**This video explains how the prisoner’s dilemma game works. We start by explaining the prisoners’ situation, then we see how to solve the game, and analyse its consequences.

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The prisoner’s dilemma is probably the most widely used game in game theory. Its use…

##### D.2 Extensive form

**Description**This video explains what the extensive form is. We start by learning how to build a game tree to analyse games, and then use a couple of examples to see how to use it.

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In game theory, the extensive form is a way…

##### D.1 Strategic form

**Description**This video explains what the strategic form is. We start by learning how to build a matrix to analyse games, and then use a couple of examples to see how to use it.

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In game theory, the strategic form (or normal form) is…