Simple Economic Models

  • Michael R. Hammock
  • J. Wilson Mixon


This chapter illustrates two models using Maxima. The first model is the production possibilities curve, which is a simple model of economy-wide production. The second model is that of competitive markets, where demand and supply determine the equilibrium price and quantity of a good. We also extend this model to examine disequilibrium and the effects of shifts in demand or supply, along with the relevance of elasticities, the impact of taxes, and the value that markets generate.


Price Elasticity Demand Curve Supply Curve Marginal Willingness Demand Price 
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Further Readings 24

  1. Baldani J, Bradfield J, Turner RW (1996) Mathematical economics. Dryden, Fort Worth,  Chaps. 1 2.
  2. Wainwright K, Chiang AC (2004) Fundamental methods of mathematical economics, 4th edn. McGraw-Hill, New York,  Chaps. 1 2.

Copyright information

© Springer Science+Business Media, LLC 2013

Authors and Affiliations

  • Michael R. Hammock
    • 1
  • J. Wilson Mixon
    • 2
  1. 1.Department of Economics and FinanceMiddle Tennessee State UniversityMurfreesboroUSA
  2. 2.Berry CollegeMount BerryUSA

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