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Unformatted text preview: ARE 100B M. Whitney YOURNAME::~ ________ ====::==========~ \ FIRST MIDTERM This exam has two sections. Section A consists of 10 multiplechoice questions, each worth 10 points. Total possible points in Section A = 100. SPRING 2009 Section B consists of 5 problems each worth 30 points. Partial credit is given for correct approach even if final answer is incorrect, so show your work! Total possible points in Section B == 150. Total points in this exam: 250 SECTION A 1. Which of the strategies below works best if customers are identical in their preferences for goods? a. Bundling € > Twopart tariff c. Both a and b. d. Neither a nor b. Questions 2 and3 refer to the info below. A competitive fInn's annual total costs are: TC = 2500 + 200q + q2 2. In longrun equilibrium, how many units of output does this fInn produce? a. 10 b.25 (2)50 ([ 100 e. None of the above. 3. What is the longrun equilibrium price of this good? a.$200 b. $210 c.$250 @)$300 e.$400 f. None of the above. 4. A monopolist raised its product's price from $100 to $120, but quantity sold also increased at the same time. Under which pricing strategy below would this outcome be likely? a. Intertemporal price discrimination <EJ Peakload pricing c. Seconddegree price discrimination d. All of the above. e. None of the above. 5. For a monopolist, which of the following pricing strategies results in an efficient outcome, with no deadwe~tloss? ® Firstdegree (perfect) price discrimination b. Seconddegree price discrimination c. Thirddegree price discrimination d. All of the above. e. None of the above, since all monopoly pricing strategies create a deadweight loss. 6. A monopolist charges $150 per treatment for a patented drug it sells. The cost of producing the drug is constant at $30 per treatment. What is the implied elasticity of demand for this drug? G)1.25 b. 1.5 c. 2 d. 3 e. None of the above. 7. Which of the pricing strategies below is common in the book publishing industry?...
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 Spring '09
 CHENGUANG
 Monopoly, Price Discrimination, producer, seconddegree price discrimination, monopoly price

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