ECON104: Dr. Dave Brown – Exam 1 Practice - Page 1of 20ECON 104 Practice Problems for Exam 1 It is strongly recommended to go through these practice problems. Note that the actual exam will be worth 80 points. 60 points short answer 20 points (10 questions) multiple choice The short answer portion will focus on the newer macro material, chapters 8 and 9.
ECON104: Dr. Dave Brown – Exam 1 Practice - Page 2of 20A. Assume only the production of two goods, laptops and tablets. Putting laptops on the vertical axis, draw an individual PPC on the left and a society level PPC on the right. Be sure to note the similarities and differences. B. On the four axes below, draw the following: 1.an increase in quantity demanded 2.a decrease in quantity demanded 3.an increase in demand 4.a decrease in demand C. On the four axes below, draw the following: 1.an increase in quantity supplied 2.a decrease in quantity supplied 3.an increase in supply 4.a decrease in supply
ECON104: Dr. Dave Brown – Exam 1 Practice - Page 3of 20D. Solve for equilibrium: 𝑄𝑄𝑑𝑑= 99−2𝑃𝑃𝑄𝑄𝑠𝑠= 7 + 2𝑃𝑃E. Consider the demand and supply equations shown below. Find the resulting shortage or surplus when the price is $2. 𝑄𝑄𝑑𝑑= 6−2𝑃𝑃𝑄𝑄𝑠𝑠= 3 +𝑃𝑃F. See the circular flow diagram below. Label the arrows to show what goods or services flow through the product and factor markets, as well as how those goods and services are paid for.
ECON104: Dr. Dave Brown – Exam 1 Practice - Page 4of 20G. What is the expenditure equation used to calculate GDP? In the United States, what is true about net exports? H. The table below shows some macroeconomic data for Mexico. Wages $3220 Government purchases $2350 Exports $310 Pollution Damages $560 Investment expenditures $700 Consumption expenditures $5150 Imports $820 Intermediate Goods $1000 Given the information above, calculate Mexico’s GDP for the year. I. The entire working age population of Sutton is 940. In this population, there are 120 retired people, 84 unemployed people, and 540 employed people. All others are full time students who are not working. How many people are in the labor force in Sutton? What is the unemployment rate in Sutton? What is the employment-population ratio?
ECON104: Dr. Dave Brown – Exam 1 Practice - Page 5of 20J. The table below shows some quantity and price information for two years. Assume that the two goods shown are the only two goods produced in the economy. 2011 2015 Product Quantity Price Quantity Price Cheese 62 $2 87 $5 Bread 145 $3 166 $6 For the following questions, use the table above. Show work for all questions.
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