# SCHOOL OF ECONOMICS AND FINANCE THE UNIVERSITY OF HONG KONG ECON6021 MICROECONOMICS PROBLEM SET NO.3 COMPETITIVE MARKETS AND MONOPOLY

Size: px
Start display at page:

Download "SCHOOL OF ECONOMICS AND FINANCE THE UNIVERSITY OF HONG KONG ECON6021 MICROECONOMICS PROBLEM SET NO.3 COMPETITIVE MARKETS AND MONOPOLY"

Transcription

1 SCHOOL OF ECONOMICS AND FINANCE THE UNIVERSITY OF HONG KONG ECON60 MICROECONOMICS PROBLEM SET NO.3 COMPETITIVE MARKETS AND MONOPOLY This problem set contains short-answer (true, false, uncertain) problems and longeranswer problems in microeconomics. The short-answer questions should take no more than one page to answer, while the longer-answer questions should generally take no more than two pages to answer. Please write on only one side of the paper. Disclaimer: While this problem set is designed to be reasonably comprehensive, it does not cover every topic that the student should be familiar with for the Economics 60 exams. I do not recommend you prepare for exams by exclusively doing these problems. READER S GUIDE TOPIC LONGER PROBLEM NOS. Competitive Markets, 8, 0,,, 4, 5, 6 Monopoly and Market Power, 3, 4, 5, 6, 7, 9, 3

3 Longer-Answer Problems:. Suppose there are a large number of potential firms, all of which can produce widgets with the following long-run total cost function C = + q + q The (inverse) market demand Q for widgets is given by P=5- Q/ What is the long-run competitive equilibrium for this industry in terms of price, market output, and number of firms?. A monopolist s demand curve is Q = 00 - P and the total cost functions of its two plants are: C = 0q C = 0. 5q and Q = q + q Find the best output for each plant and market price for Q. Show the results graphically, including the numerical values for the relevant marginal costs, quantities, and price. 3. A monopolist s demand curve is Q = 360-0P and its long-run total cost function is C = 6Q Q Suppose the government wishes to impose a maximum price on Q at the level that will induce the firm to produce the greatest equilibrium output. What price will be set and how much will the firm produce? What is the resulting increase in consumers surplus compared to the unconstrained monopoly? Show the results graphically, including the numerical values for the relevant marginal costs, quantities, and prices. 3

4 4. A monopolist has two plants with the following total costs: TC = X TC ( + X = 4) + X + ( X ) = X 0. 5 His demand curve is P = 4 ( X + X ) = 4 0.5( X + X ) How much output (if any) will be produced in each plant? What price will be charged? Show your results graphically including the numerical values for P, X, X and X. 5. A monopoly firm produces widgets by using only two factors of production, capital and labor. The firm has a fixed amount of capital and hires all the labor it wants at a wage of w. Initially its profit-maximizing output and price are Q0 and P0 respectively. Suppose the workers organize and form a labor union. They do not attempt to raise wages, but they are successful in obtaining an effective feather-bedding contract, i.e., the firm must employ at least L workers whether it uses them or not, where L is greater than the initial number of employees L 0. Show graphically and explain the effects of the contract on the firm s: (a) Short-run marginal cost function. (b) Short-run average cost function. (c) Optimal price and output levels. (d) What, if anything, can be said about the effects of the contract on the distribution of incomes to the union members and the owners of the firm? 6. A hospital produces services that can be quantified in two dimensions: quantity (Q) and quality (C). It faces infinitely elastic market demands for both of these aspects of service. Prevailing prices are P = \$0, P = \$4. The hospital s total costs are given by: q c TC = 0.Q + 0.C 5 (a) If the hospital wishes to maximize profits, how much Q and C should be 4

5 produced? What will profits be? (b) Suppose that the hospital is managed by a nonprofit foundation. The utility of the foundation s president depends upon both hospital outputs according to the following function: U(Q,C) = min(q,c). If the hospital is now constrained to have the same total cost as in the profitmaximizing case, what level of Q and C will be chosen to maximize the foundation president s utility? What will profits be in this case compared to (a)? 7. Suppose that a monopolist can choose both the quantity of output (q) he produces and his level of advertising (A). His inverse market demand function is P = 00 3q + 4A and his total cost function is C = 0q + 4q + A. (a) Find the profit maximizing level of output, advertising, and price. (b) Suppose a law is passed which prevents the monopolist from advertising (constrains A=0). Calculate the profit-maximizing price and quantity. (c) How would you evaluate whether or not the law benefits consumers? 8. Suppose a perfectly competitive industry can produce widgets at a constant marginal cost of \$0 per unit. Once the industry is monopolized, marginal costs rise to \$ per unit because \$ per unit must be paid to lobbyists to retain the widget producers favored position. Suppose the market demand for widgets is given by Q D = P Calculate the perfectly competitive and monopoly outputs and prices. Calculate the total loss of consumer surplus from monopolization of widget production. Divide the loss of consumer surplus into transfer to profit, cost increase, and deadweight loss. Graph your results and label all relevant points and magnitudes. 9. Some states limit the number of liquor stores that can sell liquor at the retail level in 5

6 a given area. Assume that the objective of the state is to maximize the revenue from liquor sales, and that the industry has constant marginal costs. (a) Suppose the state gives a monopoly to one seller, and charges a license fee L for the right to the monopoly. Write down the profit function for the monopolist and characterize the profit-maximizing solution. What would be the effect of an increase in the license fee on the price paid by consumers? (b) Instead of a license fee, the state decides to impose a tax on each unit the monopolist sells. What would be the effect of this tax on the price of liquor? Which would be a more effective means of raising revenue, the tax or the license fee? 0. Suppose the market demand for widgets is given by Q D = 00 P and the market supply by Q S = 0 + 6P (a) What will be the equilibrium price and quantity of widgets? (b) Suppose the government levies a tax of \$4 per widget. Now what will be the equilibrium quantity? What price will consumers pay and what price will firms receive? (c) How is the burden of the tax shared by buyers and sellers? What is the tax revenue and what is the deadweight loss due to the tax? Show graphically and discuss results.. The demand for bricklayers is given by the function L D = 000 0W and the supply of bricklayers is given by the function L S = 5 W + 90 (a) Determine the equilibrium wage (W), the equilibrium number of bricklayers employed, and the total wage income of the bricklayers. (b) Now suppose that 0 bricklayers immigrate from a foreign country and are willing to work at any wage they can find. What will this influx of workers do to the equilibrium wage rate, the number of employed domestic workers, and the total wage income of domestic workers? 6

7 (c) Show, graphically and compare the results for (a) and (b).. The bicycle-manufacturing industry is a constant-cost competitive industry. Bicycle brakes may fail due to poor manufacture, incorrect assembly, lack of maintenance, operator misjudgement, etc. Two extreme positions; with regard to product safety are caveat emptor (let the buyer beware) and caveat vendor (let the seller beware). Under the former scheme, producers would have no responsibility for the safety of their products: buyers would absorb all losses. Under the latter scheme, this liability assignment would be reversed: firms would be completely responsible under law for losses incurred from unsafe products. Using supply and demand analysis, discuss how the assignment of such liability might affect the output and price of bicycles to consumers and to manufacturers. State any assumptions made. Would safer products necessarily be produced if firms were strictly liable under the law? Explain. 3. A utility company is a monopolistic supplier of electricity to two types of customers: residential and commercial. Their demands for electricity, Q R and Q C respectively are: Q = Q = 00 R P R C P C The marginal cost of supplying electricity is constant and equal to \$0. The utility also has fixed costs of \$6000. (a) A profit-maximizing and price discriminating utility would produce what output, charge what prices, and make what profit? (b) If the utility is required by law to charge a uniform price, what will it be? Will the social benefits of this action outweigh the social costs? Explain. (c) If the utility is required to set a uniform price equal to marginal cost, what output and price will result? Show graphically and explain. 4. A perfectly competitive constant-cost industry contains a number of firms, each of which has the following long-run total cost function, where q is a typical firm s annual output: 3 LTC = 0.0q.q + q The market demand curve is Q = P, where Q is annual industry sales. (a) Calculate the long-run equilibrium price and output of the industry. (b) How many firms are there in the industry in the long-run? 7

8 (c) Suppose the government decides to reduce the number of firms to 60 and sells licenses annually by competitive bidding. What is the new price of the product? What is the new industry output? What is the equilibrium price of a license? (d) Suppose instead of selling the licenses, the government decides to allocate them without charge to 60 qualified firms. Discuss generally what effect this will have on the nature of equilibrium in the market. 5. The local bus company has 80 buses. The operating cost of a bus is \$30 during the day and \$60 during the night, when higher wages must be paid to drivers and other workers. The daily capital cost of a bus, whether it is used or not, is \$0. The demands for buses aggregated over persons and stops during the hours of day and night, respectively D and N, are Q Q =60 = 80 D P D N P N (a) If additional buses are to be purchased, what is the efficient number of buses? What prices should be charged to induce efficient ridership of them? Will all of the buses be in use at night? (b) If the number of buses is limited to 80, what prices are efficient? (c) Draw a graph which illustrate the outcomes for (a) and (b). 6. An economics professor at Midstate University estimated that student demand for football tickets at the University was significantly different from the demand by the general public. The specific demand functions are P = (student demand) s Q s P = (general public demand) g Q g for prices measured in cents and quantities in thousands of tickets. The costs of the football program are \$50,000 per year for travel expenses and \$750,000 per year for scholarships, salaries, etc. (a) Determine a pricing policy that would maximize profits. Show graphically and explain. (b) How would the solution change if stadium capacity were limited to fifty thousand admissions per game? Explain. (c) Is the price structure in (b) sustainable? Explain. 8

### Economics 500: Microeconomic Theory

Economics 500: Microeconomic Theory State University of New York at Binghamton Department of Economics Problem Set #12 Answers 1. The Coase Theorem says that efficiency in resource allocation will result

### Econ 2113: Principles of Microeconomics. Spring 2009 ECU

Econ 2113: Principles of Microeconomics Spring 2009 ECU Chapter 12 Monopoly Market Power Market power is the ability to influence the market, and in particular the market price, by influencing the total

### NAME: INTERMEDIATE MICROECONOMIC THEORY FALL 2006 ECONOMICS 300/012 Final Exam December 8, 2006

NAME: INTERMEDIATE MICROECONOMIC THEORY FALL 2006 ECONOMICS 300/012 Section I: Multiple Choice (4 points each) Identify the choice that best completes the statement or answers the question. 1. The slope

### Microeconomics. Use the graph below to answer question number 3

More Tutorial at Microeconomics 1. Opportunity costs are the values of the: a. minimal budgets of families on welfare b. hidden charges passed on to consumers c. monetary costs of goods and services *

### Microeconomics. Use the graph below to answer question number 3

More Tutorial at Microeconomics 1. Opportunity costs are the values of the: a. minimal budgets of families on welfare b. hidden charges passed on to consumers c. monetary costs of goods and services *

### short run long run short run consumer surplus producer surplus marginal revenue

Test 3 Econ 3144 Name Fall 2005 Dr. Rupp 20 Multiple Choice Questions (50 points) & 4 Discussion (50 points) Signature I have neither given nor received aid on this exam Use this table to answer questions

### Do not open this exam until told to do so. Solution

Do not open this exam until told to do so. Department of Economics College of Social and Applied Human Sciences K. Annen, Fall 003 Final (Version): Intermediate Microeconomics (ECON30) Solution Final (Version

### ECON 115. Industrial Organization

ECON 115 Industrial Organization 1. Linear (3rd Degree) Price Discrimination First Hour QUIZ Second Hour Introduction to Price Discrimination Third-degree price discrimination Two Rules Examples of price

### A monopoly market structure is one characterized by a single seller of a unique product with no close substitutes.

These notes provided by Laura Lamb are intended to complement class lectures. The notes are based on chapter 12 of Microeconomics and Behaviour 2 nd Canadian Edition by Frank and Parker (2004). Chapter

### MICROECONOMICS SECTION I. Time - 70 minutes 60 Questions

MICROECONOMICS SECTION I Time - 70 minutes 60 Questions Directions: Each of the questions or incomplete statements below is followed by five suggested answers or completions. Select the one that is best

### UNIT 4 PRACTICE EXAM

UNIT 4 PRACTICE EXAM 1. The prices paid for resources affect A. the money incomes of households in the economy B. the allocation of resources among different firms and industries in the economy C. the

### Eco402 - Microeconomics Glossary By

Eco402 - Microeconomics Glossary By Break-even point : the point at which price equals the minimum of average total cost. Externalities : the spillover effects of production or consumption for which no

### Queen s University Department of Economics ECON 111*S

Queen s University Department of Economics ECON 111*S Take-Home Midterm Examination May 24, 25 Instructor: Sharif F. Khan Suggested Solutions PART A TRUE/FALSE/UNCERTAIN QUESTIONS Explain why each of the

### January Examinations 2014

January Examinations 2014 DO NOT OPEN THE QUESTION PAPER UNTIL INSTRUCTED TO DO SO BY THE CHIEF INVIGILATOR Department Module Code Module Title Exam Duration (in words) Economics Microeconomics Two hours

### Do not remove any pages or add any pages. No additional paper is supplied

ECON 001 Spring 2018 Midterm 2 March 27, 2018 Time Limit: 60 Minutes Name (Print): Recitation Section: Name of TA: This exam contains 5 pages (including this cover page) and 10 questions. Check to see

### FINALTERM EXAMINATION FALL 2006

FINALTERM EXAMINATION FALL 2006 QUESTION NO: 1 (MARKS: 1) - PLEASE CHOOSE ONE Compared to the equilibrium price and quantity sold in a competitive market, a monopolist Will charge a price and sell a quantity.

### Ford School of Public Policy 555: Microeconomics A Fall 2010 Exam 3 December 13, 2010 Professor Kevin Stange

Ford School of Public Policy 555: Microeconomics A Fall 2010 Exam 3 December 13, 2010 Professor Kevin Stange This exam has 7 questions [ 5 short, 1 medium length, 1 very long] and spans the topics we have

### Monopoly. 3 Microeconomics LESSON 5. Introduction and Description. Time Required. Materials

LESSON 5 Monopoly Introduction and Description Lesson 5 extends the theory of the firm to the model of a Students will see that the profit-maximization rules for the monopoly are the same as they were

### 1. For a monopolist, present the standard diagram showing the following:

ECON 202: Principle of Microeconomics Name: Fall 2006 Bellas Second Midterm You have two hours and thirty minutes to complete this exam. Answer all questions, explain your answers, label axes and curves

### Practice Exam 3: S201 Walker Fall with answers to MC

Practice Exam 3: S201 Walker Fall 2007 - with answers to MC Print Your Name: I. Multiple Choice (3 points each) 1. If marginal utility is falling then A. total utility must be falling. B. marginal utility

### ECON 101 KONG Midterm 2 CMP Review Session. Presented by Benji Huang

ECON 101 KONG Midterm 2 CMP Review Session Presented by Benji Huang Chapter 5 Efficiency and Equity Benefit, Cost, Surplus Consumers (1) A consumer benefits from the consumption of a product this benefit

### Answer all the following questions:-

Answer all the following questions:- QUESTION ONE / TRUE ( ) OR FALSE (X) / (10 MARKS) 1. Total revenue = price x sold quantity. 2. The purpose of a production function is to tell us just how much output

### arguments for and against and explain which you believe is soundest based on your understanding.

1. Should the federal government continue to provide Amtrak with subsides? Provide economic arguments for and against and explain which you believe is soundest based on your understanding. 2. Based on

### Problem Set 4 Eco 112, Fall 2011 Chapters covered: Ch. 8 and Ch. 9 (up to slide 15 Price Discrimination) Due date: October 20, 2011

Problem Set 4 Eco 112, Fall 2011 Chapters covered: Ch. 8 and Ch. 9 (up to slide 15 Price Discrimination) Due date: October 20, 2011 There are 30 multiple choice questions in this problem set. Answer these

### 1. Welfare economics is the study of a. the well-being of less fortunate people. b. welfare programs in the United States.

1. Welfare economics is the study of a. the well-being of less fortunate people. b. welfare programs in the United States. c. the effect of income redistribution on work effort. d. how the allocation of

### Economics : Principles of Microeconomics Spring 2014 Instructor: Robert Munk April 24, Final Exam

Economics 001.01: Principles of Microeconomics Spring 01 Instructor: Robert Munk April, 01 Final Exam Exam Guidelines: The exam consists of 5 multiple choice questions. The exam is closed book and closed

Question # 1 of 15 ( Start time: 01:24:42 PM ) Total Marks: 1 A person with a diminishing marginal utility of income: Will be risk averse. Will be risk neutral. Will be risk loving. Cannot decide without

### Micro Semester Review Name:

Micro Semester Review Name: The following review is set up to emphasize certain concepts, graphs and terms. It is the responsibility of the individual teachers to emphasize and review the analysis aspects

### Microeconomics. Use the Following Graph to Answer Question 3

More Tutorial at www.dumblittledoctor.com Microeconomics 1. To an economist, a good is scarce when: *a. the amount of the good available is less than the amount that people want when the good's price equals

### Econ*1050 Introductory Microeconomics Instructor: Vitali Alexeev. Quiz 6 (Chapter 8)

Econ*1050 Introductory Microeconomics Instructor: Vitali Alexeev Quiz 6 (Chapter 8) 1) A tax on a good a. raises the price buyers pay and lowers the price sellers receive. b. raises both the price buyers

### Case: An Increase in the Demand for the Product

1 Appendix to Chapter 22 Connecting Product Markets and Labor Markets It should be obvious that what happens in the product market affects what happens in the labor market. The connection is that the seller

### Practice Final Exam. Write an expression for each of the following cost concepts. [each 5 points]

Practice Final Exam Total : 200 points Exam time: 7:00 9:00. You have 6 questions in 3 pages. Please make your diagrams clear and label it. Good Luck! 1. Amy is currently spending her income to maximize

### 1. For a monopolist, present the standard diagram showing the following:

ECON 202: Principle of Microeconomics Name: Fall 2005 Bellas Second Midterm - Answers You have two hours and twenty minutes to complete this exam. Answer all questions, explain your answers, label axes

### Market Power at Work: Computer Market Revisited

Monopolies Part II Competition is always a good thing. It forces us to do our best. A monopoly renders people complacent and satisfied with mediocrity. Nancy Pearcey Market Power at Work: Computer Market

### MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. FIGURE 1-2

Questions of this SAMPLE exam were randomly chosen and may NOT be representative of the difficulty or focus of the actual examination. The professor did NOT review these questions. MULTIPLE CHOICE. Choose

### Chapter 28 The Labor Market: Demand, Supply, and Outsourcing

Chapter 28 The Labor Market: Demand, Supply, and Outsourcing Learning Objectives After you have studied this chapter, you should be able to 1. define marginal factor cost, marginal physical product of

### Ecn Intermediate Microeconomic Theory University of California - Davis June 11, 2009 Instructor: John Parman. Final Exam

Ecn 100 - Intermediate Microeconomic Theory University of California - Davis June 11, 2009 Instructor: John Parman Final Exam You have until 8pm to complete the exam, be certain to use your time wisely.

### ECON 2100 (Summer 2016 Sections 10 & 11) Exam #3C

ECON 21 (Summer 216 Sections 1 & 11) Exam #3C Multiple Choice Questions: (3 points each) 1. I am taking of the exam. C. Version C 2. is a market structure in which there is one single seller of a unique

### ECON 2100 (Summer 2016 Sections 10 & 11) Exam #3D

ECON 21 (Summer 216 Sections 1 & 11) Exam #3D Multiple Choice Questions: (3 points each) 1. I am taking of the exam. D. Version D 2. is a market structure in which there is one single seller of a unique

### 2) A production method that relies on large quantities of labor and smaller quantities of capital equipment is referred to as a: 2)

Micro: TA Session 4, Problem set MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) The main difference between a short-run production function and

### This paper is not to be removed from the Examination Halls

~~EC2066 ZA d0 This paper is not to be removed from the Examination Halls UNIVERSITY OF LONDON EC2066 ZB BSc degrees and Diplomas for Graduates in Economics, Management, Finance and the Social Sciences,

### Practice Exam 3: S201 Walker Fall 2009

Practice Exam 3: S201 Walker Fall 2009 I. Multiple Choice (3 points each) 1. Which of the following statements about the short-run is false? A. The marginal product of labor may increase or decrease. B.

### Advanced Microeconomic Theory. Chapter 7: Monopoly

Advanced Microeconomic Theory Chapter 7: Monopoly Outline Barriers to Entry Profit Maximization under Monopoly Welfare Loss of Monopoly Multiplant Monopolist Price Discrimination Advertising in Monopoly

### Thanksgiving Handout Economics 101 Fall 2000

Thanksgiving Handout Economics 101 Fall 2000 The purpose of this handout is to provide a variety of problems illustrating many of the ideas that we have discussed in class this semester. The questions

### Choose the single best answer for each question. Do all of your scratch-work in the side and bottom margins of pages.

Econ 101, Sections 3 and 4, S11, Schroeter Exam #2, Special code = 0002 Choose the single best answer for each question. Do all of your scratch-work in the side and bottom margins of pages. 1. The cross-price

### Basics of Economics. Alvin Lin. Principles of Microeconomics: August December 2016

Basics of Economics Alvin Lin Principles of Microeconomics: August 2016 - December 2016 1 Markets and Efficiency How are goods allocated efficiently? How are goods allocated fairly? A normative statement

### Eastern Mediterranean University Faculty of Business and Economics Department of Economics Fall Semester

Eastern Mediterranean University Faculty of Business and Economics Department of Economics 2016-17 Fall Semester Duration: 110 minutes ECON101 - Introduction to Economics I Final Exam Type A 11 January

### The Ohio State University Department of Economics Final Examination. Answer all questions, show all work, and label all graphs.

The Ohio State University Department of Economics Final Examination Econ 501.02 Winter 2007 Prof. James Peck Directions: Answer all questions, show all work, and label all graphs. 1. (10 points) True or

### Ecn Intermediate Microeconomic Theory University of California - Davis December 10, 2009 Instructor: John Parman. Final Exam

Ecn 100 - Intermediate Microeconomic Theory University of California - Davis December 10, 2009 Instructor: John Parman Final Exam You have until 12:30pm to complete this exam. Be certain to put your name,

### Gregory Clark Econ 1A, Fall 2000 FINAL VERSION #1. A total of 100 points are possible. Last Name: First Name:

Gregory Clark Econ 1A, Fall 2000 FINAL VERSION #1 A total of 100 points are possible. Last Name: First Name: Your Student ID Number: - - Part A: Multiple Choice Questions (20 questions, each of which is

### THEORY OF THE FIRM. Number of Workers Bread Loaves (thousands) :

Universidad Carlos III Microeconomics THEORY OF THE FIRM A. Production. 1. Answer the questions of parts (a)-(e) for rms whose production functions are: (1.1) F (L; K) = p LK; (1.2) F (L; K) = L + 4K,

### Homework 4 Economics

Homework 4 Economics 501.01 Manisha Goel Due: Tuesday, March 1, 011 (beginning of class). Draw and label all graphs clearly. Show all work. Explain. Question 1. Governments often regulate the price of

### Sample. Final Exam Sample Instructor: Jin Luo

Final Exam Instructor: Jin Luo Multiple Choice (2 *30 = 60) Identify the letter of the choice that best completes the statement or answers the question. 1. Price takers refer to buyers and sellers in a.

### MICROECONOMICS Midterm Test (sample)

Student Name:.. MICROECONOMICS Midterm Test (sample) Time: 60 minutes Student Number:. Total Mark:... /50 Class:. Converted Mark:../10 Section A: QUIZ 20 marks Show your answers on the ANSWER SHEET at

### Choose the single best answer for each question. Do all of your scratch work in the margins or in the blank space at the bottom of the last page.

Econ 0, Section 2, S0, Schroeter Exam #4, Special code = Choose the single best answer for each question. Do all of your scratch work in the margins or in the blank space at the bottom of the last page..

### Choose the single best answer for each question. Do all of your scratch work in the margins or in the blank space at the bottom of the last page.

Econ 0, Section 2, S0, Schroeter Exam #4, Special code = 2 Choose the single best answer for each question. Do all of your scratch work in the margins or in the blank space at the bottom of the last page..

### Eco 202 Exam 2 Spring 2014

Eco 202 Exam 2 Spring 2014 PLEASE ANSWER 50 OF THE FOLLOWING QUESTIONS. 1. Jon Brooks quit his job in a bicycle shop, where he earned \$15,000 per year, to become a graduate student in economics. At the

### EC1000 MICROECONOMICS ' MOCK EXAM

EC1000 MICROECONOMICS ' MOCK EXAM Time Allowed Two Hours (2 Hours) Instructions to candidates This paper is in two sections. Students should attempt ALL the questions in both Sections The maximum mark

### The University of Zambia School of Humanities and Social Sciences The Department of Economics

The University of Zambia School of Humanities and Social Sciences The Department of Economics ECN 1115 INTRODUCTION TO MICRO ECONOMICS- ASSIGNMENT 1 Attempt ALL Questions and briefly explain why your answer

### ECO 2301 Spring EXAM 2 Form 2 Wednesday, April 1 st Solutions

ECO 2301 Spring 2015 Sec 002 Klaus Becker EXAM 2 Form 2 Wednesday, April 1 st Solutions 1. Mathematically, price elasticity of demand is: A. the percentage change in the quantity of a good that is demanded

### 2007 NATIONAL ECONOMICS CHALLENGE NCEE/Goldman Sachs Foundation

2007 NATIONAL ECONOMICS CHALLENGE NCEE/Goldman Sachs Foundation National Round I: Microeconomics David Ricardo Division 1. If your income tax liability is \$15,000 and your income is \$60,000, your A. average

### The above Figure 1 shows the demand and cost curves facing a monopolist.

Practice 13&14 1) The key characteristics of a monopolistically competitive market structure include A) few sellers. B) sellers selling similar but differentiated products. C) high barriers to entry. D)

### ECON 1000 D. Come to the PASS workshop with your mock exam complete. During the workshop you can work with other students to review your work.

It is most beneficial to you to write this mock midterm UNDER EXAM CONDITIONS. This means: Complete the midterm in 2.5 hours. Work on your own. Keep your notes and textbook closed. Attempt every question.

### PICK ONLY ONE BEST ANSWER FOR EACH BINARY CHOICE OR MULTIPLE CHOICE QUESTION.

Econ 101 Summer 2015 Answers to Second Mid-term Date: June 15, 2015 Student Name Version 1 READ THESE INSTRUCTIONS CAREFULLY. DO NOT BEGIN WORKING UNTIL THE PROCTOR TELLS YOU TO DO SO You have 75 minutes

### Perfectly Competitive Supply. Chapter 6. Learning Objectives

Perfectly Competitive Supply Chapter 6 McGraw-Hill/Irwin Copyright 2013 by The McGraw-Hill Companies, Inc. All rights reserved. Learning Objectives 1.Explain how opportunity cost is related to the supply

### 5. A Positive Statement A. attempts to explain how the world actually is or how the world actually functions.

ECON 2100 (Summer 2009 Section 04) Final Exam Answer Key Multiple Choice Questions: (2 points each) 1. The Principle states that since people have unlimited needs/wants but only a limited amount of resources,

### Price discrimination by a monopolist

Review Imperfect Competition: Monopoly Reasons for monopolies Monopolies problem: Choses quantity such that marginal costs equal to marginal revenue The social deadweight loss of a monopoly Price discrimination

Chapter 13 MODELS OF MONOPOLY Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved. 1 Monopoly A monopoly is a single supplier to a market This firm may choose to produce

### MIDTERM II. GROUP A Instructions: December 18, 2013

EC101 Sections 03 Fall 2013 NAME: ID #: SECTION: MIDTERM II December 18, 2013 GROUP A Instructions: You have 60 minutes to complete the exam. There will be no extensions. The exam consists of 30 multiple

### Ph.D. MICROECONOMICS CORE EXAM August 2017

Ph.D. MICROECONOMICS CORE EXAM August 2017 This exam is designed to test your broad knowledge of microeconomics. There are three sections: one required and two choice sections. You must complete both problems

### c. Explain the concept of consumer incidence in reference to your answer to part b of this question

Final PPA 897, Spring 2012 Professor John McPeak Name: The total exam is worth 25 points. Each numbered question is worth 2 ½ points, and each sub question within a numbered question is worth an equal

### Hours needed to produce one unit of manufactured goods agricultural goods Pottawattamie 6 3 Muscatine 3 2

Econ 101, sections 2 and 6, S06 Schroeter Makeup Exam Choose the single best answer for each question. 1. A "zero sum game" is one in which a. every player breaks even in the long run. b. there is only

### Econ190 May 1, No baseball caps are allowed (turn it backwards if you have one on).

Heather Krull Final Exam Econ190 May 1, 2006 Name: Instructions: 1. Write your name above. 2. No baseball caps are allowed (turn it backwards if you have one on). 3. Write your answers in the space provided

### JANUARY EXAMINATIONS 2008

No. of Pages: (A) 9 No. of Questions: 38 EC1000A micro 2008 JANUARY EXAMINATIONS 2008 Subject Title of Paper ECONOMICS EC1000 MICROECONOMICS Time Allowed Two Hours (2 Hours) Instructions to candidates

### ECON 101 MIDTERM 1 REVIEW SESSION SOLUTIONS (WINTER 2015) BY BENJI HUANG

ECON 101 MIDTERM 1 REVIEW SESSION SOLUTIONS (WINTER 2015) BY BENJI HUANG TABLE OF CONTENT I. CHAPTER 1: WHAT IS ECONOMICS II. CHAPTER 2: THE ECONOMIC PROBLEM III. CHAPTER 3: DEMAND AND SUPPLY IV. CHAPTER

### Professor Christina Romer SUGGESTED ANSWERS TO PROBLEM SET 2

Economics 2 Spring 2018 rofessor Christina Romer rofessor David Romer SUGGESTED ANSWERS TO ROBLEM SET 2 1.a. In this problem we are dividing everything the household buys into two categories child care

### I enjoy teaching this class. Good luck and have a nice Holiday!!

ECON 202-501 Fall 2008 Xiaoyong Cao Final Exam Form A Instructions: The exam consists of 2 parts. Part I has 35 multiple choice problems. You need to fill the answers in the table given in Part II of the

### Policy Evaluation Tools. Willingness to Pay and Demand. Consumer Surplus (CS) Evaluating Gov t Policy - Econ of NA - RIT - Dr.

Policy Evaluation Tools Evaluating Gov t Policy - Econ of NA - RIT - Dr. Jeffrey Burnette In economics we like to measure the impact government policies have on the economy and separate winners and losers.

### THEORY OF THE FIRM. 2. Let us consider the production function Q = F (L; K) = LK: a) Compute the isoquants K = g(l) for Q = 729 and Q = 100:

Universidad Carlos III Microeconomics THEORY OF THE FIRM A. Production. 1. Let us consider the production function Q = F (L; K) = (LK) 1 2 : a) Compute the isoquants K = g(l) for Q = 27 and Q = 10: b)

### ECON 251 Exam 1 Pink Spring 2012

ECON 251 Exam 1 Pink Spring 2012 1. Which of the following is an example of the economic resource of capital? a. A \$20 bill b. A corporate bond c. a government savings bond d. none of the above 2. John

### Microeconomics, marginal costs, value, and revenue, final exam practice problems

Microeconomics, marginal costs, value, and revenue, final exam practice problems (The attached PDF file has better formatting.) *Question 1.1: Effects on Marginal Cost Which of the following is most likely

### SUMMARY OF THE MODELS OF UNIT 4

SUMMARY OF THE MODELS OF UNIT 4 Chapter 13: Eight Labor Market Models 1. Competitive labor market in a competitive product market 2. Competitive labor market in an imperfectly competitive product market

### Eight Labor Market Models - SUMMARY

Eight Labor Market Models - SUMMARY 1 Eight Labor Market Models 1. Competitive labor market in a competitive product market 2. Competitive labor market in an imperfectly competitive product market 3. Monopsony

### Labor Market Equilibrium. Labor Economics VŠE March 2010

Labor Market Equilibrium Labor Economics VŠE March 2010 Perfectly Competitive Labor Market Assumptions: Perfect Information: o All workers know relevant details about all jobs; o All employers know relevant

### Specific Learning Goals/Benchmarks and Student Assessment. AP Macroeconomics

Unit Bartram Trail HS Specific Learning Goals/Benchmarks and Student Assessment AP Macroeconomics # Benchmark Assessment 1 1 1 2 1 3 1 4 2 5 2 6 3 7 3 8 3 9 3 10 3 11 4 12 4 13 4 14 4 15 4 16 4 17 Define

### Practice Test for Midterm 2 Econ Fall 2009 Instructor: Soojae Moon

Practice Test for Midterm 2 Econ 2010-200 Fall 2009 Instructor: Soojae Moon Please read carefully and choose the choice that best completes the statement or answers the question. Table 7-2 This table refers

### ECON 2100 (Summer 2015 Sections 07 & 08) Exam #3A

ECON 2100 (Summer 2015 Sections 07 & 08) Exam #3A Multiple Choice Questions: (3 points each) 1. I am taking of the exam. A. Version A 2. For a firm with market power Marginal Revenue, while for a firm

### Practice Exam 3: S201 Walker Fall 2004

Practice Exam 3: S201 Walker Fall 2004 I. Multiple Choice (3 points each) 1. Which of the following statements about the short-run is false? A. The marginal product of labor may increase or decrease. B.

### Econ 98 (CHIU) Midterm 1 Review: Part A Fall 2004

Disclaimer: The review may help you prepare for the exam. The review is not comprehensive and the selected topics may not be representative of the exam. In fact, we do not know what will be on the exam.

Econ 226 Principles of Microeconomics Fall, 24 Dr. Kathryn Wilson Due Date: Tuesday, September 28 th Homework 2 Answer Key 1. When the of movie admissions increases from \$7 to \$8, the demanded falls from

### Your Name: UM uniquename. Ford School of Public Policy 555: Microeconomics A Fall 2011 Placement Exam Professor Kevin Stange

Your Name: UM uniquename Ford School of Public Policy 555: Microeconomics A Fall 2011 Placement Exam Professor Kevin Stange This exam has 8 questions and spans the topics we expect to cover in the course.

### Section I (20 questions; 1 mark each)

Foundation Course in Managerial Economics Examination Marks- 100, Time 3 hours Section I (20 questions; 1 mark each) 1. Which of the following statements is not true: a. Rich countries also face problems

### Department of Economics University of California, Davis ECONOMICS 1A. Second Midterm Exam Version B

Department of Economics University of California, Davis ECONOMICS 1A Spring 2010 L. Jay Helms Second Midterm Exam Version B Last Name: First Name: Your Student ID Number: Please check your registered section

### This paper is not to be removed from the Examination Halls

~~EC2066 ZA d0 This paper is not to be removed from the Examination Halls UNIVERSITY OF LONDON EC2066 ZA BSc degrees and Diplomas for Graduates in Economics, Management, Finance and the Social Sciences,

### Multiple Choice Questions Exam Econ 205 Pascal Courty MOCK MIDTERM

Multiple Choice Questions Exam Econ 205 Pascal Courty MOCK MIDTERM Instructions: This is a closed-book exam. There are 30 questions and you have 45 minutes. Each question has only one correct answer. A

### ICMB202/203 Microeconomics. Final Practice Questions. Carefully explain whether each of the following statements is true, false or uncertain.

ICMB202/203 Microeconomics Final Practice Questions Question 1 Carefully explain whether each of the following statements is true, false or uncertain. a) Because of their monopoly power, monopolists always

### EXAMINATION 4 VERSION B Perfect and Imperfect Competition November 26, 2018

William M. Boal Signature: Printed name: EXAMINATION 4 VERSION B Perfect and Imperfect Competition November 26, 2018 INSTRUCTIONS: This exam is closed-book, closed-notes. Simple calculators are permitted,

### EXAMINATION 4 VERSION A Perfect and Imperfect Competition November 26, 2018

William M. Boal Signature: Printed name: EXAMINATION 4 VERSION A Perfect and Imperfect Competition November 26, 2018 INSTRUCTIONS: This exam is closed-book, closed-notes. Simple calculators are permitted,