final and hws - Final Exam 120 minutes Econ 1101 Principles...

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1 Final Exam 120 minutes Econ 1101: Principles of Microeconomics Thomas Holmes December 18, 2006 Name: _______________________________________________ TA’s Name: __________________________________________ Section Number: ______________________________________ ( TA’s Name and Section Number are worth 4 points, not bonus. ) Points are allocated on a 200 point scale. Clearly highlight/circle solutions. If you need more space, use the back of the page. Clearly state where your work/answer are. Calculators are NOT allowed. You may leave answers as fractions. Fully label all graphs. Read each question carefully and be sure to answer all parts of every question. There should be 12 pages including the cover sheet.
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2 Question 1 (6 points). State the First Welfare Theorem of Economics Question 2 (10 points). Reservation Prices and Costs in Econland Name of D Person Reservation price for one widget ($) Cost to make one widget ($) Name of S Person D1 9 1 S1 D2 8 2 S2 D3 7 3 S3 D4 6 4 S4 D5 5 5 S5 D6 4 6 S6 D7 3 7 S7 D8 2 8 S8 D9 1 9 S9 D10 0 10 S10 None of the allocations below are Pareto efficient. In each case, propose a Pareto improvment. (a) An allocation where S8 produces a widget but S3 does not. (b) An allocation where D1 and D7 consume widgets but D3 and D10 do not. (c) An allocation where S1 produces a widget and gives it to D1 and no other widgets are produced and consumed.
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