Practice Exam 1.pdf - Name Student Pawprint MICROECONOMICS 1014 EXAM 1 Spring 2019 VERSION Practice Please do not open the exam until you are told to

# Practice Exam 1.pdf - Name Student Pawprint MICROECONOMICS...

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Name: ___________________ Student #_____________ Pawprint ___________ MICROECONOMICS 1014 EXAM 1 Spring 2019 VERSION: Practice Please do not open the exam until you are told to. Fill in NAME, STUDENT ID and PAWPRINT on top of this cover sheet and the scantron sheet. Fill in all answers on your scantron. No answers will be accepted unless they are marked on the scantron. Only pencils, erasers, one double-sided 8.5 x 11 cheat sheet, and a non-graphic calculator are allowed in this exam. No other devices are allowed. You cannot use your cell phone as the calculator. Tear this cover sheet off and turn it in with your scantron to the proctor after completing your exam! You can keep the exam questions for your own record.
1.(Table: iPhone and iPod Production) Using the table on iPhone and iPod production in the United States and Canada, assume each country specializes in the good for which it has a comparative advantage. Which of the following answers identifies a trade price that both countries would find acceptable? A)One iPhone for one iPod < trade price < 4/3 of one iPhone for one iPod. B)3/4 of one iPhone for one iPod < trade price < one iPhone for one iPod C)3/2 of an iPhone for one iPod < trade price < 2 iPhones for 1 iPod. D)4/3 of an iPhone of one iPod < trade price < 2 iPhones for one iPod. 2.Table: Equilibrium QuantityBased on the table, the equilibrium price is: 3.Two countries that specialize where they have a comparative advantage and then trade with each other will experience increases in: I. average wages in both countries. II. total output in both countries. III. overall living standards in both countries.
4.(Figure: Good X) From the figure, the maximum price that consumers are willing to pay for _____ units of good X is _____ per unit. 5.Suppose that large oil reserves are discovered off the coast of Cuba, and these reserves will increase the world's supply of oil by 2.5%. If the elasticity of demand and supply of oil are -0.50 and 0.40, respectively, what happens to the price of oil? A)It falls by 2.78%. B)It falls by 25%. C)It falls by 2.5%. D)It falls by 36%. 6.If sellers want to sell more products than buyers are willing to purchase, we know that: