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Econ_1_Final_W04_Exam

Econ_1_Final_W04_Exam - DARTMOUTH COLLEGE ECONOMICS 1 PRICE...

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D ARTMOUTH C OLLEGE P ROFESSOR J ESSE G IUMMO E CONOMICS 1: P RICE S YSTEM F INAL E XAM W INTER 2004: 100 POINTS Name _ ________________________ Instructions : You will have 3 hours to complete the final exam. This exam is worth 100 points. There are 16 multiple-choice questions worth a total of 32 points, and 4 essay questions worth a total of 68 points. P ART I: 16 M ULTIPLE -C HOICE Q UESTIONS (32 POINTS ) 1. In a market for pollution rights an increase in demand would: A) raise the price of pollution rights, but leave the quantity unchanged. B) stimulate the economic incentive to pollute. C) increase the actual amount of pollution. D) induce an increase in the supply of pollution rights. 2. When farmer Fred weights the benefits and cost of placing pesticides on his crops, he doesn’t consider the cost runoff of the pesticides will have on fishing in nearby streams. This is an example of a: 3. In the case of a negative supply side externality in the production of a good the intersection of private demand and private supply: 4. A natural monopoly exists when: 5. Which of the following is a characteristic of pure monopoly? A) close substitute products B) barriers to entry C) the absence of market power D) "price taking"
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D ARTMOUTH C OLLEGE P ROFESSOR J ESSE G IUMMO E CONOMICS 1: P RICE S YSTEM 6. A nondiscriminating pure monopolist's demand curve: 7. In comparing the demand curve of a pure monopolist with that of a monopolistically competitive firm, we would expect the monopolistic competitor to have a:
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