Final exam 2009

Final exam 2009 - Name_ AEC 303 Final Exam May 8, 2009 1....

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Name____________________________ AEC 303 Final Exam May 8, 2009 1. You have an income of $60 to spend on movie tickets and basketball tickets. Movie tickets cost $6 and basketball tickets cost $12. a. If you spent all of your income on movie tickets, how many could you buy? b. What is the opportunity cost of movie tickets in terms of basketball tickets? c. Graph your initial budget constraint and label it BB’ on the graph on this page. d. Suppose the price of movie tickets increases to $10 while everything else stays the same. Draw your new budget constraint and label it MM’ on the same graph on this page. e. Suppose your income increases to $96 while the prices of both commodities remain at $6 and $12 respectively. Draw your new budget constraint and label it NN’. 1
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The demand the Cournot duopoly quantity-setting firms face is 2 1 120 q q p - - = Assume that the marginal cost facing firm 1 is 20 and the marginal cost facing firm 2 is 30. Suppose that firms choose quantities simultaneously. What is the profit maximizing quantity for each firm and the profit maximizing price? 2
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This note was uploaded on 02/07/2011 for the course AEC 303 taught by Professor Staff during the Fall '08 term at Kentucky.

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Final exam 2009 - Name_ AEC 303 Final Exam May 8, 2009 1....

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