Econ 300: Intermediate Microeconomics, Spring 2014 Final Exam Study Guide 1

Size: px
Start display at page:

Download "Econ 300: Intermediate Microeconomics, Spring 2014 Final Exam Study Guide 1"

Transcription

1 Econ 300: Intermediate Microeconomics, Spring 2014 Final Exam Study Guide 1 Chronological order of topics covered in class (to the best of my memory). Introduction to Microeconomics (Chapter 1) What is microeconomics? What are models and why are they used? Simplifications used in models Positive vs. normative statements Math Review (see online notes) Finding slopes, intercepts, and graphing lines. Rules of exponents and logs. First-order derivatives. Partial derivatives. Review of Supply and Demand (Chapter 2) Determinants of demand (income, tastes and preferences, future price expectations, etc.). Quantity demand vs. demand curve. Law of demand. Demand functions, D(p)=a-bp. Determinants of supply. Quantity supplied vs. supply curve. Supply functions, S(p) Market equilibrium. I.e. intersection of demand and supply. Be able to calculate it and graph it. Shifts in demand and supply curves and their effects on equilibrium. Price ceilings, price floors. Minimum wage laws. What affect do they have on equilibrium? Applying the Supply and Demand Model: Welfare, Elasticities (Chapters 3 and 9.1, 9.2, 9.3, 9.4) How shapes of the demand and supply curves affect equilibrium after a shock. Price elasticity of demand. Know formula, nomenclature, how to calculate it. Elasticity along a linear demand curve (Figure 3.2). 1 More technically, an abbreviated list of topics admissible on the final exam. 1

2 Income elasticity, cross-price elasticity. Know formula, definition, how to calculate. Price elasticity of supply. Elasticity along a supply curve (Figure 3.5). Effects of taxes: 1) sales tax or ad valorem tax; 2) specific tax or unit tax. Know difference and applications of each. o How tax effects depend on elasticities. Formula 3.6. o Tax incidence of a specific tax. Formula 3.7 Consumer and produce surplus. Know definitions, how to calculate them. Welfare=CS+PS. Perfect competition maximizes welfare. o How CS and PS changes as equilibrium prices change. Figure 9.3. Deadweight loss (DWL). What is it? When do we observe it? Figure 9.5. Consumer Choice, Utility, Utility Maximization (Chapter 4; handouts on utility max problems) How do consumers choose what bundles of goods to consumer? They pick the ones that maximize their utility subject to their budget constraint. Preference theory: completeness, transitivity, more is better, reflexive. Indifference curves. Where do they come from? They come from preferences. Figure 4.1. o Properties of indifference curves: can t cross, slope downward, convex toward the origin, one exists for every possible bundle and the higher the IC the more preferred it is. Know how properties are derived from preference theory. o Be able to draw them for perfect substitutes, perfect complements, and imperfect substitutes. o Slope of the IC = marginal rate of substitution (MRS). Know how to calculate it. Diminishing MRS. Figure 4.3. Utility theory. What is a utility function? Tells us how much happiness/pleasure/satisfaction a consumer gets from consuming some bundle of goods. o Ordinal vs. cardinal. Utility is an ordinal concept. Relates back to philosophy. o Utility and indifference curves. How are they related? Answer: utility is constant anywhere along an IC. Higher IC s yield more utility. o Marginal utility(mu x, MU y ). Know that MRS is ratio of the marginal utilities of the two goods being consumed. Be careful! MU of the good on the x-axis always goes in the numerator. Budget constraints. Know what it is, how to write it out, how to graph it. Shifts in them (price changes cause pivots, income changes cause parallel shifts). Figure 4.8. o Slope of the BC = marginal rate of transformation (MRT). Equals the negative ratio of the prices. o Budget set or opportunity sets. Selection of the optimal bundle. Lagrangian method, MRS=MRT method, etc. Know how to solve these types of problems. Maximizing utility subject to a budget constraint. Solving for optimal consumption of goods. Be able to graph them. Figure 4.9 is good. o See Appendix on chapter 5 for math. 2

3 o Interior solution vs. corner solution. Applying Consumer Theory, Deriving Demand curves, Income and Substitution Effects (Chapter 5) Deriving demand curves. Comes from price changes in consumer market. Know how to do it graphically. Figure 5.1. Know it! Price consumption curve. Engel curve. Income consumption curve. Figure 5.2. Know difference between Engel and income consumption curves. Income elasticities as applied to normal and inferior goods. Know signs and definitions. At least one good much be normal (always). Income elasticities vary with income (on Exam #2). Income and substitution effects. They are used to decompose a price change. Know definitions, how to graph them. Figures 5.5 and 5.6. Know these well. Theory of the Firm and Firm Production (Chapter 6) What is a firm? It s a black box. Converts inputs into outputs using technology. Types of firms: private, public, for-profit, non-profit, etc. Assume in this class that all firms maximize profits. Profit=revenue-cost. Efficient production. Know definition. See Exam #2 question. Inputs: capital, labor, materials. Focus on capital and labor. What are they? Production function. Takes inputs converts them to output. Q=f(L,K). Short-run vs. long-run production. Has to do with fixed inputs and nothing else. Short-run production with one fixed input. Be able to fill-in a table similar to Table 6.1. o Marginal product of labor/capital vs. average product of labor/capital. Know terms and how to calculate. o Rules of graphing MP L and AP L. Marginals pull averages. Law of diminishing marginal returns. Long-run production (all inputs are variable). o Isoquants curves. Know definitions and how to graph. Very similar to indifference curves. See Figures 6.2, 6.3, and 6.4. o Slope of isoquant = marginal rate of technical substitution (MRTS). How is it calculated? Derivative method and delta method. Figure 6.4. Equation 6.5 is really really good to know. Returns to scale: constant, decreasing, increasing. Be able to calculate them for a given production function. Are returns to scale always fixed for the firm? Answer: No! Firm can have DRS for some output levels and IRS for other output levels. Technological change. Add constant in front of production function. 3

4 Costs of the Firm (Chapter 7) Economic efficiency. How is this different than productive efficiency? Economic costs vs. accounting costs. Know difference. Sunk costs. Short-run costs: fixed costs, variable costs, marginal costs, total costs, average variable costs, average fixed costs, average costs. 7 of them in the short-run. Know definitions and how to calculate each like in Table 7.1. Graphing short-run cost curves. This is important. Figure 7.1. Marginals pull averages. MC intersects AC and AVC at their minimum values. AC and AVC are u-shaped in theory. MC looks like a check mark. AC>AVC because of fixed costs. Shape of MC curve depends on wage and marginal product of labor. See Equation 7.1 and PowerPoint slide posted online for Ch. 7. Shape of the AC curve depends on wage and average product of labor. See Equation 7.2. Ignore effects of taxes on costs. We didn t cover this. Long-run costs. All costs are variable in the long run! o Input choice problem. Firm must decide cost minimizing level of capital and labor to use. o Cost equation. Isocost equation. Graph isocost. What is it? Cost minimization problem. Three equivalent rules: 1) lowest-isocost rule; 2) tangency rule; 3) last dollar rule. Know how to graph cost minimizing bundle. Solve for it mathematically. I suggest the tangency rule: MRTS = w. r Expansion paths. What are they? Graph them. Solve for them like on Exam #2. Economies of scale and diseconomies of scale. Relate back to returns to scale. Why are costs lower in the long run? Long-run cost curve is the envelope of short-run curves. Figure 7.9. Economies of scope. Don t confuse with economies of scale. Competitive Markets and Profits (Ch. 8; selections) Perfectly competitive markets. Firms as price takers. Horizontal demand curve. Why? Answer: large number of buyers and sellers, perfect information, etc. Does the perfectly competitive market actually exist? No! It is a theoretical construct that economists only use as a benchmark. Ignore the stuff on residual demand curves. Profit maximization. Profit = total revenue total cost. Two steps: 1) output decision; 2) shutdown decision. o Know the three output rules and two shutdown rules. Figure 8.2. o Marginal revenue=marginal cost is the profit max condition. Or, MR(q)=MC(q), mathematically. MR(q)=p in the competitive market. 4

5 o Figure 8.3 is really important (panel b). Know how to graphically find the equilibrium profit level of output and how to calculate the profit (in dollars). Shutdown rule: p<avc(q). If true, then the firm cannot cover its average variable costs so should shut down. Fixed costs do not enter into the firm s shutdown decision in the short-run. Figure 8.4. Short-run supply curve for the firm. It is the MC curve above where p=avc (the shutdown point). Short-run market supply curve. Know difference between market supply and firm supply. What happens to the market supply curve as more firms enter the market? Answer: becomes more elastic (horizontal). Figure 8.7. Short-run competitive equilibrium. Firm takes price decided in the market as given. Sets p=mc to get its profit max level of output. Figure 8.9. Long-run competition. Need to know that have free entry and exit in long-run. No fixed inputs. When will firms enter and exit the industry? Monopoly (Chapter 11; selections) What is a monopoly? Do they still exist today? How is the monopolist s profit max problem different than the competitive firm s? Answer: monopolist faces downward sloping demand curve so must lower the price of all units sold in order to sell an additional unit. Competitive firm takes price as given. Monopolist is a price setter. Figure 11.1 o MR=MC for monopolist. But, MR p for the monopolist like for the competitive firm. o Marginal revenue curve for the monopolist. How does it relate to the demand curve? Answer: double the slope (i.e. steeper). o Monopolist sets MR=MC to determine profit max quantity output. Goes up to the demand curve to determine price. Figure Are monopolies bad? No, consider a natural monopoly. Welfare effects of monopoly. They create DWL. Figure Know that a monopoly reduces total welfare compared to a competitive firm. 5

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.

Final Exam - Solutions

Ecn 100 - Intermediate Microeconomics University of California - Davis December 7, 2010 Instructor: John Parman Final Exam - Solutions You have until 12:30 to complete this exam. Be certain to put your

Ecn Intermediate Microeconomic Theory University of California - Davis March 19, 2009 Instructor: John Parman. Final Exam

Ecn 100 - Intermediate Microeconomic Theory University of California - Davis March 19, 2009 Instructor: John Parman Final Exam You have until 5:30pm to complete the exam, be certain to use your time wisely.

MICRO FINAL EXAM Study Guide

AP MICROECONOMICS-217 Name: MICRO FINAL EXAM Study Guide Instructions: Please fight senioritis! Study & be efficient with your time. DUE: Friday April 28 th (Multiple choice block 4/26 th or 27 th Free

Faculty of Economics, Thammasat University EE 211 Principles of Microeconomics (3 credits)

Faculty of Economics, Thammasat University EE 211 Principles of Microeconomics (3 credits) Semester 1/2014 ----------------------------------------------------------------------------------------------

Final Exam - Solutions

Ecn 100 - Intermediate Microeconomic Theory University of California - Davis December 10, 009 Instructor: John Parman Final Exam - Solutions You have until 1:30pm to complete this exam. Be certain to put

Faculty of Economics, Thammasat University EE 211 Principles of Microeconomics (3 credits)

Lecture Time: Lecture Venue: Instructor: Faculty of Economics, Thammasat University EE 211 Principles of Microeconomics (3 credits) Semester 1/2015 ----------------------------------------------------------------------------------------------

Final Exam - Solutions

Ecn 00 - Intermediate Microeconomic Theory University of California - Davis September 9, 009 Instructor: John Parman Final Exam - Solutions You have until :50pm to complete this exam. Be certain to put

Marginal Cost. Average Cost 0 20 NA NA NA a) Is this a short run or long run information on cost? Why?

McPeak PPA 723 Exam 2 Name: All numbered questions are worth 2 points each, sub questions worth an equal share of these 2 points. 1) Complete the following table. Output Fixed Cost Total Cost Variable

Microeconomics: MIE1102

TEXT CHAPTERS TOPICS 1, 2 ECONOMICS, ECONOMIC SYSTEMS, MARKET ECONOMY 3 DEMAND AND SUPPLY. MARKET EQUILIBRIUM 4 ELASTICITY OF DEMAND AND SUPPLY 5 DEMAND & CONSUMER BEHAVIOR 6 PRODUCTION FUNCTION 7 COSTS

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

What Is Perfect Competition? Perfect competition is an industry in which Many firms sell identical products to many buyers. There are no restrictions to entry into the industry. Established firms have

Final Exam - Solutions

Ecn 100 - Intermediate Microeconomics University of California - Davis June 8, 2010 Instructor: John Parman Final Exam - Solutions You have until 10:00am to complete this exam. Be certain to put your name,

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

Review Notes for Chapter Optimal decision making by anyone Engage in an activity up to the point where the marginal benefit= marginal cost

Review Notes for Chapter 5 1. Optimal decision making by anyone Engage in an activity up to the point where the marginal benefit= marginal cost Sunk costs are costs which must be borne regardless of future

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.

Contents Unit 1 Introduction to Business (Managerial) Economics Meaning of Managerial Economics... 2 Definitions of Managerial Economics... 2 Features (Characteristics) of Managerial Economics... 5 Nature

CH 15: Monopoly. Lecture

CH 15: Monopoly Lecture Characteristics of Monopolies A monopoly is a market structure in which one firm makes up the entire market Firm=Industry Characteristics of Monopolies The monopolist is a price

Average Cost 0 20 NA NA NA a) Is this a short run or long run information on cost? Why?

McPeak PPA 723 Exam 2 Name: All numbered questions are worth 2 points each, sub questions worth an equal share of these 2 points. 1) Complete the following table. Output Fixed Cost Total Cost Variable

AP Microeconomics Review With Answers 1. Firm in Perfect Competition (Long-Run Equilibrium) 2. Monopoly Industry with comparison of price & output of a Perfectly Competitive Industry (which means show

The Four Main Market Structures

Competitive Firms and Markets The Four Main Market Structures Market structure: the number of firms in the market, the ease with which firms can enter and leave the market, and the ability of firms to

CH 14: Perfect Competition

CH 14: Perfect Competition Characteristics of Perfect Competition 1. Both buyers and sellers are price takers A price taker is a firm (or individual) who takes the price determined by market supply and

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,

REDEEMER S UNIVERSITY

REDEEMER S UNIVERSITY Km 46/48 Lagos Ibadan Expressway, Redemption City, Ogun State COLLEGE OF MANAGEMENT SCIENCE DEPARTMENT OF ECONOMICS AND BUSINESS STUDIES COURSE CODE /TITLE ECO 202/Microeconomics

Ecn Intermediate Microeconomics University of California - Davis December 7, 2010 Instructor: John Parman. Final Exam

Ecn 100 - Intermediate Microeconomics University of California - Davis December 7, 2010 Instructor: John Parman Final Exam You have until 12:30 to complete this exam. Be certain to put your name, id number

Chapter 1- Introduction

Chapter 1- Introduction A SIMPLE ECONOMY Central PROBLEMS OF AN ECONOMY: scarcity of resources problem of choice Every society has to decide on how to use its scarce resources. Production, exchange and

ECON 102 Brown Final Exam Practice Exam Solutions

www.liontutors.com ECON 102 Brown Final Exam Practice Exam Solutions 1. B 2. C 3. C All products are identical (homogenous) in perfect competition so there is no such thing as brand preference. 4. C Breakeven

Economics MCQ (1-50) GAT Subject Management Sciences.

Economics MCQ (1-50) GAT Subject Management Sciences www.accountancyknowledge.com 51. If a 5% increase in price causes no change in total revenue, this means? (a) Demand is price inelastic (b) Demand is

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

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.

Micro Economics M.A. Economics (Previous) External University of Karachi Micro-Economics

Micro Economics M.A. Economics (Previous) External University of Karachi Micro-Economics Annual Examination 1997 Time allowed: 3 hours Marks: 100 Maximum 1) Attempt any five questions. 2) All questions

Contents. Introduction

Contents Chapter 1 Introduction Introduction to Economics... 1 Meaning of Economics... 1 Definitions of Economics... 2 Introduction to Economic Theory... 3 The Structure of Theories... 5 Importance of

Ecn Intermediate Microeconomic Theory University of California - Davis September 9, 2009 Instructor: John Parman. Final Exam

Ecn 100 - Intermediate Microeconomic Theory University of California - Davis September 9, 2009 Instructor: John Parman Final Exam You have until 1:50pm to complete this exam. Be certain to put your name,

Week One What is economics? Chapter 1

Week One What is economics? Chapter 1 Economics: is the social science that studies the choices that individuals, businesses, governments, and entire societies make as they cope with scarcity and the incentives

Perfect Competition CHAPTER14

Perfect Competition CHAPTER14 MARKET TYPES The four market types are Perfect competition Monopoly Monopolistic competition Oligopoly MARKET TYPES Perfect Competition Perfect competition exists when Many

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

Chapter 11 Perfect Competition

Chapter 11 Perfect Competition Introduction: To an economist, a competitive firm is a firm that does not determine its market price. This type of firm is free to sell as many units of its good as it wishes

Chapter 3 Outline. Consumer Theory. Chapter 3: Model of Consumer Behavior. Challenge: Why Americans Buy E-Books and Germans Do Not

Chapter 3 Outline Chapter 3 Consumer Theory If this is coffee, please bring me some tea; but if this is tea, please bring me some coffee. Abraham Lincoln Challenge: Why Americans Buy E-Books and Germans

To produce more beach balls, you must give up ever increasing quantities of ice cream cones.

Unit 01: Basic Concepts (Macro/Micro) Scarcity The Economic Problem: Unlimited wants, limited economic resources Factors of Production: -Land -Labor -Capital -Entrepreneurship Big 3 Questions: -What to

Ecn Intermediate Microeconomic Theory University of California - Davis December 10, 2008 Professor John Parman.

Ecn 100 - Intermediate Microeconomic Theory University of California - Davis December 10, 2008 Professor John Parman Final Examination You have until 12:30pm to complete the exam, be certain to use your

Managerial Economics & Business Strategy. Final Exam Section 2 May 11 th 7:30 am-10:00 am HH 076

Managerial Economics & Business Strategy Final Exam Section 2 May 11 th 7:30 am-10:00 am HH 076 Grading Scale 5% - Attendance 8% - Homework (Drop the lowest grade) 7% - Quizzes (Drop the lowest grade)

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

FOR MORE PAPERS LOGON TO

ECO401- Economics Question No: 1 ( Marks: 1 ) - Please choose one Land is best described as: Produced factors of production. "Organizational" resources. Physical and mental abilities of people. "Naturally"

1.3. Levels and Rates of Change Levels: example, wages and income versus Rates: example, inflation and growth Example: Box 1.3

1 Chapter 1 1.1. Scarcity, Choice, Opportunity Cost Definition of Economics: Resources versus Wants Wants: more and better unlimited Versus Needs: essential limited Versus Demand: ability to pay + want

Contents. Concepts of Revenue I-13. About the authors I-5 Preface I-7 Syllabus I-9 Chapter-heads I-11

Contents About the authors I-5 Preface I-7 Syllabus I-9 Chapter-heads I-11 1 Concepts of Revenue 1.1 Introduction 1 1.2 Concepts of Revenue 2 1.3 Revenue curves under perfect competition 3 1.4 Revenue

University of Toronto July 27, ECO 100Y L0201 INTRODUCTION TO ECONOMICS Midterm Test # 2

Department of Economics Prof. Gustavo Indart University of Toronto July 27, 2006 SOLUTION ECO 100Y L0201 INTRODUCTION TO ECONOMICS Midterm Test # 2 LAST NAME FIRST NAME STUDENT NUMBER INSTRUCTIONS: 1.

ECON 2100 Principles of Microeconomics (Summer 2016) Monopoly

ECON 21 Principles of Microeconomics (Summer 216) Monopoly Relevant readings from the textbook: Mankiw, Ch. 15 Monopoly Suggested problems from the textbook: Chapter 15 Questions for Review (Page 323):

Microeconomics Exam Notes

Microeconomics Exam Notes Opportunity Cost What you give up to get it Production Possibility Frontier Maximum attainable combination of two products (Concept of Opportunity Cost). Main Decision Makers:

CHAPTER 8. Managing in Competitive, Monopolistic, and Monopolistically Competitive Markets

CHAPTER 8 Managing in Competitive, Monopolistic, and Monopolistically Competitive Markets CHAPTER OUTLINE Perfect competition Demand at the market and firm levels Short-run output decisions Long-run decisions

SCHOOL OF ACCOUNTING AND BUSINESS BSc. (APPLIED ACCOUNTING) GENERAL / SPECIAL DEGREE PROGRAMME

All Rights Reserved No. of Pages - 07 No of Questions - 08 SCHOOL OF ACCOUNTING AND BUSINESS BSc. (APPLIED ACCOUNTING) GENERAL / SPECIAL DEGREE PROGRAMME YEAR I SEMESTER I INTAKE VIII (GROUP B) END SEMESTER

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

Long Run Analysis. Definition 3

Long Run Analysis Long run: Each firm has time to change its input mix optimally: for each firm short and long run supply curve can be different (see digression on next slide) Unless profits are 0, firms

Ecn Intermediate Microeconomic Theory University of California - Davis December 10, 2008 Professor John Parman.

Ecn 100 - Intermediate Microeconomic Theory University of California - Davis December 10, 2008 Professor John Parman Final Examination You have until 12:30pm to complete the exam, be certain to use your

Quiz #5 Week 04/12/2009 to 04/18/2009

Quiz #5 Week 04/12/2009 to 04/18/2009 You have 30 minutes to answer the following 17 multiple choice questions. Record your answers in the bubble sheet. Your grade in this quiz will count for 1% of your

Monopoly CHAPTER 15. Henry Demarest Lloyd. Monopoly is business at the end of its journey. Monopoly 15. McGraw-Hill/Irwin

CHAPTER 15 Monopoly Monopoly is business at the end of its journey. Henry Demarest Lloyd McGraw-Hill/Irwin Copyright 2010 by the McGraw-Hill Companies, Inc. All rights reserved. A Monopolistic Market A

Intermediate Microeconomic Theory Economics 3070 Summer Introduction and Review: Chapters 1, 2 (plus corresponding study guide)

Intermediate Microeconomic Theory Economics 3070 Summer 1994 Professor M.J. Greenwood Office: Econ 208 Office Hours: 3:40-4:20 daily and by appointment A Term COURSE OUTLINE Part I. Text: Robert H. Frank,

Cost ATC AVC MC Output 2

Intermediate Microeconomics Answers to second midterm 1.a. The firm s short run supply curve is the portion of the marginal cost curve on and above the minimum of average variable cost, and zero for prices

Unit 6 Perfect Competition and Monopoly - Practice Problems

Unit 6 Perfect Competition and Monopoly - Practice Problems Multiple Choice Identify the choice that best completes the statement or answers the question. 1. One characteristic of a perfectly competitive

ECON 3710, Intermediate Microeconomics Exam #1 Spring, 2008

ECON 3710, Intermediate Microeconomics Dr. Tod Porter Exam #1 Spring, 2008 Last Name First Name 1. (30 pts.) Put an "X" directly over the "T" if the statement is true, or an "X" over the "F" if it is false.

2007 Thomson South-Western

Monopolistic Competition Characteristics: Many sellers Product differentiation Free entry and exit In the long run, profits are driven to zero Firms have some control over price What does the costs graph

Midterm 2 - Solutions

Ecn 100 - Intermediate Microeconomic Theory University of California - Davis November 13, 2009 Instructor: John Parman Midterm 2 - Solutions You have until 11:50am to complete this exam. Be certain to

Principles of Microeconomics Module 5.1. Understanding Profit

Principles of Microeconomics Module 5.1 Understanding Profit 180 Production Choices of Firms All firms have one goal in mind: MAX PROFITS PROFITS = TOTAL REVENUE TOTAL COST Two ways to reach this goal:

Study Guide Final Exam, Microeconomics

Study Guide Final Exam, Microeconomics 1. If the price-consumption curve of a commodity slopes downward how can you tell whether the consumer spends more or less on this commodity from her budget (income)?

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

Firms in Competitive Markets

1 Basic Economics Chapter 14 Firms in Competitive Markets Competitive markets (1) Market with many buyers and sellers (e.g., ) (2) Trading identical products (e.g., ) (3) Each buyer and seller is a price

Eco 300 Intermediate Micro

Eco 300 Intermediate Micro Instructor: Amalia Jerison Office Hours: T 12:00-1:00, Th 12:00-1:00, and by appointment BA 127A, aj4575@albany.edu A. Jerison (BA 127A) Eco 300 Spring 2010 1 / 61 Monopoly Market

ECON 101: Principles of Microeconomics Discussion Section Week 12 TA: Kanit Kuevibulvanich

Important Concepts: Monopoly ECON 101: Principles of Microeconomics Discussion Section Week 12 Comparison of Perfectly Competitive Market and Monopoly Market Perfect Competition Monopoly Number of Participants

Lecture 11. Firms in competitive markets

Lecture 11 Firms in competitive markets By the end of this lecture, you should understand: what characteristics make a market competitive how competitive firms decide how much output to produce how competitive

IB Economics Microeconomics Review Mr. Dachpian

IB Economics Microeconomics Review Microeconomics Review AP Microeconomics Chapter 1: Limits, Alternatives, & Choices IB Economics Chapter 2: The Market System and the Circular Flow Market Economies and

FINAL EXAMINATION. Special Instructions: Date: DECEMBER 15, 2000 School Year: Course and No.: ECON1006EA Time: 1:30 PM- 3:30 PM

FINAL EXAMINATION Date: DECEMBER 15, 2000 School Year: 2000-2001 Course and No.: ECON1006EA Time: 1:30 PM- 3:30 PM Professor: SARLO, C Department: Arts & Science Number of Pages: 11 + cover Time Allowed:

6) The mailing must be postmarked by June 15. 7) If you have any questions please me at

Examination Instructions: 1) Answer the examination only after you have read the honesty pledge below. 2) The multiple choice section will be taken in WebCT and a tutorial for using WebCT is to be found

Contents EXPLORING ECONOMICS

Contents About the authors I-5 Preface to second edition I-7 Chapter-heads I-9 Syllabus : Choice Based Credit System (CBCS) I-19 1 EXPLORING ECONOMICS 1.1 Why study economics? 1 1.2 Meaning of economics

23 Perfect Competition

23 Perfect Competition Learning Objectives After you have studied this chapter, you should be able to 1. define price taker, total revenues, marginal revenue, short-run shutdown price, short-run breakeven

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.

= AFC + AVC = (FC + VC)

Chapter 13-14: Marginal Product, Costs, Revenue, and Profit Production Function The relationship between the quantity of inputs (workers) and quantity of outputs Total product (TP) is the total amount

Economics. Monopolistic Perfect Competition. Monopolistic Competition. Monopolistic Competition 11/29/2013. The Big Picture. Perfect Competition

16 Modified by Joseph Tao-yi Wang Ron Cronovich The Big Picture Chapter 13: The cost of production Now, we will look at firm s revenue But revenue depends on market structure 1. Competitive market (chapter

ECON 311 MICROECONOMICS THEORY I

ECON 311 MICROECONOMICS THEORY I Profit Maximisation & Perfect Competition (Short-Run) Dr. F. Kwame Agyire-Tettey Department of Economics Contact Information: fagyire-tettey@ug.edu.gh Session Overview

Course informa-on. Final exam. If you have a conflict, go to the Registrar s office for a form to bring to me

Course informa-on Final exam If you have a conflict, go to the Registrar s office for a form to bring to me To do today: Finish compe--on and start monopoly What it is and does: single price and price

Math Recitation #5 October 20, 2009

Math Recitation #5 October 20, 2009 I. Production functions II. Isoquants and isocost lines III. Increasing, decreasing and constant returns to scale IV. Costs (average, marginal, total) V. Perfect competition

Using this information, we then write the output of a firm as

Economists typically assume that firms or a firm s owners try to maximize their profit. et R be revenues of the firm, and C be the cost of production, then a firm s profit can be represented as follows,

AP Microeconomics. Content Skills Learning Targets Assessment Resources & Technology

St. Michael Albertville High School Teacher: Matthew Rooker AP Microeconomics October 2014 Content Skills Learning Targets Assessment Resources & Technology November 2014 Content Skills Learning Targets

B.V. Patel Institute of Business Management, Computer & Information Technology, Uka Tarsadia University : Managerial Economics

Unit-1 Introduction of Managerial Economics and Cost Analysis Answer the following. (1 mark) 1. Define Managerial Economics? 2. How does Managerial Economics help managers to become efficient and competent?

Economics 361 Assessment

Economics 361 Assessment (1) Learning Objectives: Students who complete Economics 361 are expected to be able to use microeconomics as a means for evaluating alternative choices (e.g., policy choices;

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

INTRODUCTION ECONOMIC PROFITS

INTRODUCTION This chapter addresses the following key questions: What are profits? What are the unique characteristics of competitive firms? How much output will a competitive firm produce? Chapter 7 THE

Final Term Examination Spring 2006 Time Allowed: 150 Minutes. Question No. 1 Marks :1. Question No.

www.vustuff.com WWW.VUTUBE.EDU.PK ECO402 Microeconomic s Final Term Examination Spring 2006 Time Allowed: 150 Minutes Question No. 1 Marks :1 Economies of scale and economies of scope are synonymous. Question

EconS Competitive Markets Part 1

EconS 305 - Competitive Markets Part 1 Eric Dunaway Washington State University eric.dunaway@wsu.edu October 11, 2015 Eric Dunaway (WSU) EconS 305 - Lecture 19 October 11, 2015 1 / 48 Introduction Today,

Exam 3 Practice Questions

Exam 3 Practice Questions 1. The price elasticity of demand is a measure of: a) how quickly a particular market reaches equilibrium. b) the change in supply associated with lower prices. c) the percent

Midterm Exam Managerial Economics Dr. John B. Horowitz Fall 2004

Midterm Exam Managerial Economics Dr. John B. Horowitz Fall 2004 Choose the best answer: (right answers are shown by *) 1. If the price of gasoline is \$2.00 and the price elasticity of demand is 0.5, how

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

TWELFTH EDITION. University of South Florida. Texas A&M University Late Professor Emeritus. Mc Graw Hill Education

MANAGERIAL Foundations of Business Analysis and Strategy TWELFTH EDITION Christopher R. Thomas University of South Florida S. Charles Maurice Texas A&M University Late Professor Emeritus Mc Graw Hill Education

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.

The Behavior of Firms

Chapter 5 The Behavior of Firms This chapter focuses on how producers make decisions regarding supply. Individuals demand goods and services. Firms supply goods and services. An important assumption is

Comm295 Midterm Review Package. October, Content:

Managerial Economics Comm295 Midterm Review Package October, 20 2014 Supply and Demand Elasticity Regression Analysis Consumer Choice Production Cost Concepts Profit Maximization Perfect Competition Monopoly

Ch. 9 LECTURE NOTES 9-1

Ch. 9 LECTURE NOTES I. Four market models will be addressed in Chapters 9-11; characteristics of the models are summarized in Table 9.1. A. Pure competition entails a large number of firms, standardized

Foundations of Business Analysis and Strategy

k 11 i- f l I_J I I } I II j "J 1r%\ "J T. "u ' Foundations of Business Analysis and Strategy TENTH EDITION (hristopher R. Thomas University of South Florida Exide Professor of Sustainable Enterprise S.

SRI LANKA INSTITUTE OF ADVANCED TECHNOLOGICAL EDUCATION. (Established in the Ministry of Higher Education, vide in Act No.

Q1. Select the correct answer and Under line it (Total 16 Marks) 01. Economics is a science. Because, (a) Evidences are observable (b) Findings are measurable (c) Findings can be analyzed i a and b correct