mtinitprac - ECO 304K UNIQUE #33515 INTRODUCTORY...

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ECO 304K UNIQUE #33515 INTRODUCTORY MICROECONOMICS SPRING 2010 INITIAL EXAM Be sure you follow directions very carefully. Section I has 8 problems. Do all 8 of the problems from that section. Section II has 2 problems. Do only 1 of the 2 problems from that section. Section III has 2 problems. Do only 1 of the 2 problems from that section. Failure to do a sufficient number of problems in any section, because of missing pages, or not following directions, will result in complete loss of points for that problem. Doing extra problems in any section will not gain you anything, and take time away from working other problems. All answers must be put on the answer document. You do not need to return this document with the questions so nothing written on this document will be graded. Please keep answers in the section devoted to that problem. Be sure your name and all your answers are on the answer document. SECTION I MULTIPLE CHOICE DO ALL 8 QUESTIONS 1 If marijuana is legalized, and the risk currently associated with buying and selling it is thereby eliminated, there is likely to be an effect on both the demand and the supply of marijuana. This would most likely affect the current equilibrium price and the current equilibrium quantity in which of the following ways? a) price will definitely decrease; quantity will definitely increase. b) price will definitely increase; quantity will definitely increase c) effect on the equilibrium price uncertain; quantity will definitely decrease. d) effect on the equilibrium quantity uncertain; price will definitely increase. e) effect on the equilibrium price uncertain; quantity will definitely increase. 2. A market is currently in equilibrium at a price of $18 and a quantity of 21. Which of the following statements is true about that market? I. An increase in the price of a complement to this good could make the market price change to $20 ceteris paribus. II. If the price of the good was $16, the quantity demanded could be 25. III. If the price of the good was $21, the quantity supplied could be 18. a) Only II is true b) Only I and II are true c) All of them are true d) Only II and III are true e) Only I and III are true
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3. Because most goods we talk about in economics are scarce… a) demand curves never intersect the horizontal axis b) demand curves always intersect the horizontal axis
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mtinitprac - ECO 304K UNIQUE #33515 INTRODUCTORY...

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