Prelim I 2009 - Professor Richard V. Burkhauser ECON 1110...

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Professor Richard V. Burkhauser Name:__________________________________ ECON 1110 Fall 2009 Section Number:__________ EXAM 1-A This exam is in two parts. For the first part, pencils only may be used. Turn the bubble sheet so that the space for your name appears in the upper left corner. Enter your name in the space provided, one letter to a box. Enter last name first, then your first initial. If your name is longer than the space provided, enter only that portion of your name that will fit. Under each letter of your name blacken the box corresponding to the letter. For each digit, blacken the numbered box below it which corresponds to the digit entered. Then in the same manner, fill in your 6 or 9 digit student identification number as shown on your Cornell ID card. Also, write either Exam 1-A or Exam 1-B (depending on the version you are taking) above your name on your bubble sheet. Read each question carefully and select the best answer. Mark the corresponding box on the answer sheet by neatly filling in the entire box. If you decide to change an answer, erase completely your previous answer. Do not make any other marks on this answer sheet. If you don't know the answer, guess. There is no additional penalty for doing so. Each Multiple-Choice Question is worth 3 points (Total 60 points). 1. The figure below shows the production possibilities frontier along with 4 output combinations. Cars A D C B Computers Which of the points on the graph represent output combinations that are inefficient? a. D and B only b. A only c. C only d. B and C only e. B only
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ECON 1110 – Exam 1-A – Fall 2009 Page 2 2. The law of demand is a. the amount of a good that a buyer with average income is willing and able to purchase. b. a graph showing the relationship between the price of a good and the amount that buyers are willing and able to purchase over a range of prices. c. the amount of a good that buyers are willing and able to purchase at a given price. d. the claim that, other things being equal, the quantity demanded of a good falls when the price of that good rises. 3. Data reveals that when the price of cham increased by 25%, the quantity of cham sold decreased by 10%, and the quantity of vort demanded decreased by 30%. What is the cross-price elasticity of demand between vort and cham? a. -0.83 b. 0.83 c. -1.20 d. 3.00 4. Which of the following statements best captures the concept of producer surplus? a. I sold a used textbook for $40 on eBay last week. This week, someone offered me $60 for it. b. Even though I was willing to pay up to $80 for a used textbook, and even though the seller was willing to go as low as $60 in order to sell it, we couldn’t reach a deal because the government has imposed a minimum selling price of $90 on the sale of textbooks. c.
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Prelim I 2009 - Professor Richard V. Burkhauser ECON 1110...

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