Exam 2- Answer Key - Economics 310 Section 1 Summer 2007...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Economics 310, Section 1 Summer 2007 Name _ANSWER KEY____ The following exam consists of 60 questions on 6 pages. Please check to see that you have all parts of the exam before beginning. The exam is worth 100 points. You have 90 minutes to complete the exam. Time may be a factor, so do not get stuck on any question. You may use a calculator. Good Luck. A. Multiple Choice (15 points, 16 Questions. Miss one for free) 1. The marginal product of labor is defined to be a. the additional output attributable to the last unit of labor employed. b. the amount of output obtained, on average, from each unit of labor employed. c. the percentage increase in output caused by a 1% rise in labor usage. d. the amount of capital that the firm can use to replace one unit of labor. 2. The shapes of the total product and marginal product curves are related because 3. An isoquant shows the various combinations of labor and capital that 4. If the marginal rate of technical substitution of labor for capital (MRTS LK ) exceeds the relative price of labor in terms of capital (P L /P K ), then 5. A competitive firm will shut down its operations in the short run when the market price falls below its a. marginal revenue. b. marginal cost. c. average cost. d. average variable cost. 6. In the long-run, a firm will exit the industry if the market price is less than its 7. Which of the following best summarizes the essence of the Invisible Hand Theorem?
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern