1 Final Economics 304K: Principles of Microeconomics Prof. Meg Ledyard Form A 3 hours Name: _____________________ UTEID: _____________________ •You have 3 hours for the exam. There are a total of 100 points. •You may NOT use calculators or other aids. •You may leave any fractions un-simplified. •Please show all of your work on the following pages. If you need more space, please use the back. •Properly label all graphs. •You should have 10 pages including this one. Please count them to be sure. •Make sure that you include your test form on your multiple choice answer sheet in the box labeled TEST FORM (1 Point) Have a good vacation!!!!
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2 Question 1 (10 points) Suppose that the market for baseball tickets is a natural monopoly. Suppose that the government regulates the market with average total cost pricing. Graphically illustrate this market for baseball tickets. In the diagram below, show: Label the price that the firm will charge under this regulation as P1Label the quantity the firm will produce under this regulation as Q1. Label or state the firm’s profits. Label or state the Deadweight Loss.