1022ndEXAMPractice2008ans

1022ndEXAMPractice2008ans - Fall 2007 ECONOMICS 102...

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Fall 2007 ECONOMICS 102 Practice 2 mid-term QUEENS COLLEGE Prof. Dohan . Some of this questions and problems will be on the second mid-term. It will be shorter. Relating concepts and definitions to the real world Match the phrases in the three lists which are best related to the concepts or words in the table below each list. * Indicates a tricky problem. Some concepts in the table may not be used, some may be used twice . 1 point each term 2____A. The amount consumers would be willing to pay above the market price is called ______. 16___B. A firm is at a true profit maximum output when MC=MR, P> minimum average costs and/or when for increases in output, the following is true. 4____C. Marginal rate of substitution in consumption of clothing for food (= C/ F ) measures _______ 10__ D. For a firm to continue producing in the long run , its total revenue must exceed its_________ 17___E. If a competitive industry relies on a large but fixed resources that is unique to that industry, such as the vineyards in the province of Champagne as this industry expands, its producers will experience ____ 19___F. An industry with no barriers to entry, no unique factors of production and no economies of scale to the firm will probably exhibit _____ TABLE A. 1. consumer profit 10. total costs 18. internal diseconomies of scale 2. consumer surplus 11. total fixed costs 19. constant returns to scale 3. deadweight economic gain 12. total variable costs 20. > marginal costs 4. MU food/MU clothing 13. marketing costs 21. < marginal costs 5. MU clothing/MU food 14. marginal benefit < marginal cost 22. a unified price policy 6. MU clothing = MU food 15. marginal benefit > marginal cost 23. Illegal pricing policies 7. MU clothing = P clothing 16. MC > MR, to meet second- order condition 24. price discrimination to capture consumer surplus 8. Total benefit < total cost 17. external diseconomies (of scale) as competitive firms bid up the price of the fixed input 9. total revenue greater than its fixed costs B11_ G. The slope of a line drawn from the origin of the total cost graph to a point on the total cost curve measures____ B8__ H. The slope of a line just tangent to a point on the total variable cost curve measures__________ B1__ I. The increase in total revenue from an increase in sales of one unit ( TR/ Q) is called ________ B6__ J*. The increase in total revenue from hiring one more unit of labor ( TR/ L) is called ________ B4___ K. Sellers charging buyers different prices according to their willingness to pay are engaging in ___. B13_ L. The long-run shut-down point of a competitive firm is at the___________ TABLE B. B1. marginal revenue B8. marginal cost B15. total fixed costs B2. total revenue B9. average fixed costs B16. total variable costs B3. average revenue B10. average variable cost B17. total costs B4. price descrimination B11. average total cost B18. fixed average marginal cost B5. marginal physical B12. marginal cost of labor B19. P=minimum average variable costs
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1022ndEXAMPractice2008ans - Fall 2007 ECONOMICS 102...

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