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Unformatted text preview: Ecn 100 - Intermediate Microeconomic Theory University of California - Davis March 19, 2009 Instructor: John Parman Final Exam You have until 5:30pm to complete the exam, be certain to use your time wisely. For multiple choice questions, mark your answer on your scantron sheet. Choose only one answer for each multiple choice question; if more than one letter is filled in for a question it will be marked wrong. For the short answer questions, write your answers directly on the exam. Show your work clearly, place a box around final answers and be certain to label any graphs you draw. Final answers may be left as fractions. Non-graphing calculators may be used but they should not be necessary. Good luck! Name: ID Number: Section: SECTION I: MULTIPLE CHOICE (60 points) 1. The short run costs of producing an amount of output y will be the long run costs of producing the same amount of output. (a) Greater than or equal to. (b) Strictly greater than (c) Less than or equal to. (d) Strictly less than. 2. When the marginal cost curve lies above the average cost curve, average costs will be: (a) Increasing as output increases. (b) Decreasing as output increases. (c) Constant as output increases. (d) They may be increasing or decreasing as output increases. 3. On a graph with good x on the horizontal axis and good y on the vertical axis, the larger the price of good x is relative to the price of good y : (a) The steeper the budget line will be. (b) The flatter the budget line will be. (c) The steeper the indifference curves will be. (d) The flatter the indifference curves will be. 4. A firms production function is given by f ( K,L ) = KL where K is capital and L is labor. The marginal product of labor for this firm is: (a) Decreasing as L gets larger. (b) Increasing as L gets larger. (c) Decreasing as K gets larger. (d) Increasing as K gets larger. 2 Final Exam 5. Which of the following is not a difference between monopolies and perfectly competitive firms? (a) Industry supply tends to be lower for a monopoly than a competitive industry. (b) Market price tends to be higher for a monopoly than a competitive industry. (c) Firm profits tend to be higher for a monopoly than a competitive firm in the long run. (d) Monopolies determine quantity by setting marginal revenue equal to marginal cost while competitive firms cannot choose quantity. 6. If goods x and y are complements and are normal, ordinary goods, an increase in the price of good x will lead to: (a) An increase in demand for y and a decrease in demand for x ....
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- Fall '08