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Econ 100a final _A_

# Econ 100a final _A_ - Department of Economics University of...

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Department of Economics Spring 2008 University of California Prof. Woroch Economics 100A FINAL EXAM – Exam Code “A” INSTRUCTIONS : Write your name , SID , your GSI’s name and the above Exam Code on the front cover of TWO BLUE BOOKS. Label one of them “#1” and the other “#2.” The exam has 4 parts. Put Parts I and II in #1, and III and IV in #2. A total of 150 points is allocated in the instructions for each part. I. EXPLAIN : Below you will find names of 4 economic phenomena . Choose 3 of them and for each, give a concise, precise explanation of how and why each phenomenon occurs. This can be done in 3 or 4 sentences. Use a graph if it aids your explanation. Each is worth 7 points. 1. backward bending labor supply 2. bandwagon effect 3. Bertrand paradox 4. free riding II. MULTIPLE CHOICE : For each of the following statements, write the letter of the alternative that best completes the statement. Do not provide an explanation for your choice. Each one is worth 5 points. 1. If a consumer’s preferences over baskets of two goods, x and y , are represented by a utility function having a marginal utility for x given by x y MU x 3 2 = , then: a) The consumer’s marginal utility of x is diminishing as consumption of x increases. b) The consumer’s marginal utility of x is increasing as consumption of x increases. c) The consumer obeys diminishing marginal rate of substitution of x for y . d) The consumer violates diminishing marginal rate of substitution of x for y . e) The consumer’s indifference curve is not convex to the origin. 2. In response to a decrease in the price of a good, the “total effect” on the quantity consumed of that good will be larger if: a) The good has a smaller substitution effect. b) The good is “normal” rather than an “inferior” good. c) The good’s Engel curve is downward sloping rather than upward sloping. d) All of the above. e) Both (a) and (b) but not (c). 3. The quantity of packages delivered per hour by a delivery service is given by F(C,D) where C is the number of delivery cars and D is the number of drivers. Assuming exactly one driver for each delivery car, then: a) F(C,D) = β (C + D) where C and D are positive whole numbers and β is some positive constant. b)

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Econ 100a final _A_ - Department of Economics University of...

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