final-prac - Practice Exam Final Exam Version 11 Please do...

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Practice Exam Final Exam Version 11 Please do not open this exam until instructed to do so. All 40 questions are multiple choice, to be answered on the bubble sheet provided. Please use a number two pencil on the bubble sheet. Fill in your answers completely. You may write on the exam question sheet, but anything you write on this exam will not be graded. You may keep this exam booklet; please hand in your scantron sheet only. Please. .. no calculators or scratch paper. If you have a question, please raise your hand and a proctor will assist you. On the bubble sheet, please be sure to include you name, ID number, section number (special codes ABC), and the correct version number of your exam (found at the top of this page) in special codes DE. You have 120 minutes to complete this exam. Good luck and Happy Holidays!
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1) Total revenue is (always) maximized where: a. Marginal revenue = 0. b. MR = MC. c. On the inelastic portion of a linear demand curve. d. On the elastic portion of a linear demand curve. e. Price = Quantity. 2) Some time ago the government of China required many highly skilled technicians and scientists to engage in unskilled agricultural labor in order to develop “proper social attitudes.” This policy probably caused China to produce a. At an inappropriate point along its production possibility frontier. b. Outside its production possibility frontier with respect to food, but inside with respect to high-technology goods c. Outside its production possibility frontier with respect to food, but inside with respect to high-technology goods. d. Outside its production possibility frontier with respect to both goods. e. Inside its production possibility frontier. 3) Because of a decrease in labor costs, a monopoly finds that its marginal cost and average total cost have decreased. Demand remains unchanged. To maximize profits, the monopoly will a. Raise its price and increase the quantity it produces. b. Raise its price and decrease the quantity it produces. c. Lower its price and increase the quantity it produces. d. Set price equal to ATC. e. Maximize marginal revenue. 4) The minimum efficient scale of a typical perfectly competitive firm is where: a. ATC is maximized. b. MC = AVC c. MC = ATC d. AFC = 0. e. AVC is minimized. 1
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Cans of dog food (cans per week) Cans of cat food (cans per week) 0 50 25 75 25 50 A B C E D F 5) Morriss has an income of $100 per week. The price of dog food is $2 per can and the price of cat food is $2 per can. However, there is a volume discount for cat food: If he buys more than 25 cans per week, the price of an additional can is only $1. In the above figure, Morriss’s budget line runs through points a. A , B , and C . b. A , B , and D . c. A , B , and E . d. A , B , and F . e. The shape of the budget line cannot be determined without knowing preferences.
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This note was uploaded on 07/28/2010 for the course ECON 101 taught by Professor Hansen during the Fall '07 term at Wisconsin.

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final-prac - Practice Exam Final Exam Version 11 Please do...

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