e1prac - Name_ EXAM ONE Introduction to Microeconomics ECO...

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Name___________________ EXAM ONE Introduction to Microeconomics ECO 304K Dr. Trinque 21 September 2006 Part One: Memorization 1. Define rationality. (2 points) 2. Modern, complex economies can function only to the extent that most people are willing to engage in unpleasant, menial tasks (like weeding). Our willingness to do so is sustained, in part, by the government activity of removing damaged currency from circulation. Explain how keeping our currency “clean” helps to keep us “well behaved” (in our economic behaviors, at least). (12 points)
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2 MORE SPACE TO ANSWER #2 3. The Production Possibilities Frontier (PPF) is, in general, bowed-out from the origin (concave). List the reasons for this. (6 points) Part Two: Application Jorge, Pat, and Geeta share an apartment. None of them likes to do laundry, nor to clean the floors. TABLE A indicates the maximum number of loads of laundry and the maximum number of floors cleaned that each can do per semester. TABLE A laundry floors Jorge 90 45 Pat 150 50 Geeta 100 25 (For example, in one semester, Jorge could do 90 loads of laundry and do zero floors, or do 60 loads of laundry and do 15 floors, etc.)
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3 4. On the axes on page 3, draw a PPF to represent the output combinations of which the three are capable, if they assign the tasks in a rational manner. Provide clear labels, and indicate the quantities at which the PPF changes
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This note was uploaded on 03/24/2008 for the course ECON 304K taught by Professor Ledyard during the Spring '08 term at University of Texas.

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e1prac - Name_ EXAM ONE Introduction to Microeconomics ECO...

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