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A linear credit demant curve

admin — Thu, 15 Apr 2010 17:58:58 +0000

Let us now comment on the value obtained for ?. Note that the broker who gets the information (e.g. a buy order from a liquidity trader) knows that it does not come from an insider. If this order were fully transferred to the market, the price would rise, since unlike broker-dealers the other agents do not know that it comes from a liquidity trader and thus revise their price estimates upwards. The broker-dealer takes advantage of this discrepancy between the market price and his own best estimate, filling the client’s order in part out of his own portfolio. He is aware that the sale will lower the price, which is why he does not fill the whole order, for if he did so, this would perfectly offset the client’s demand and the final price would be unchanged.

Thus the broker-dealer behaves like a monopolist facing a linear demand curve, and offers half the quantity demanded, so that the price is driven below the marginal cost.

Repay your credit as you go along with your project

admin — Sat, 09 Jan 2010 09:27:36 +0000

Expenses during the development, protection and marketing phases of inventing do not all occur at once. There is no need to have all the money that will be spent on the project at the beginning of the process. Very few independent inventors have a surplus amount of money set aside with which to pursue their product ideas. Most of us are operating on shoestring budgets. Many have succeeded and so can you. It may be necessary to save for a while and then move to the next phase of your product development. Then save again for the next phase and so on. As you read this book – or any book that details the steps in product development – you will see that there are lots of details related to your invention that you could be doing while you are saving between expenditures. So, it isn’t as if you have to spend all of your time in a holding pattern while you accumulate the needed funds.