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Unformatted text preview: Ecn 100 - Intermediate Microeconomic Theory University of California - Davis October 16, 2009 Instructor: John Parman Midterm 1 You have until 11:50am to complete this exam. Be certain to put your name, id number and section on both the exam and your scantron sheet and fill in test form A on the scantron. Answer all multiple choice questions on your scantron sheet. Choose the single best answer for each question; if you fill in multiple answers for a question you will be marked wrong. Answer the long answer questions directly on the exam. You must show your work for full credit. Answers may be left as fractions. Please place a box around final answers when appropriate. Good luck! Name: ID Number: Section: SECTION I: MULTIPLE CHOICE (60 points) 1. Which of the following pairs of utility functions would represent the same preferences? (a) U ( x,y ) = 2 xy and V ( x,y ) = xy . (b) U ( x,y ) = x 2 y 2 and V ( x,y ) = xy . (c) Neither (a) nor (b). (d) Both (a) and (b). 2. In which of the following cases would the demand curve for good x and the Engel curve for good x have the same sign? (a) When good x is a normal, ordinary good. (b) When good x is an inferior, Giffen good. (c) When good x is an inferior, ordinary good. (d) Both (b) and (c). 3. Suppose that every extra cookie increases Abe’s utility by four units. Which of the following must be true? (a) Abe’s marginal utility of cookies is zero. (b) Abe’s marginal utility of cookies is increasing. (c) Abe’s marginal utility of cookies is diminishing. (d) Abe’s marginal utility of cookies is positive. 4. Betty is indifferent between eating 2 apples and 6 oranges and eating 6 apples and 2 oranges. Betty prefers eating 4 apples and 4 oranges to eating 2 apples and 6 oranges. We can say for certain that: (a) Betty’s preferences are not transitive....
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- Fall '08
- Economics, horizontal axis