ECON303_PS1

ECON303_PS1 - ECON 303: Intermediate Microeconomic Theory...

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1 ECON 303: Intermediate Microeconomic Theory Spring 2011 Problem Set #1 (two pages) Due: the class lecture on Thursday, January 27 Part I Multiple Choices 1 . Plastic and steel are substitutes in the production of body panels for certain automobiles. If the price of plastic increases, with other things remaining the same, we would expect: a) the price of steel to fall. b) the demand curve for plastic to shift to the left. c) the demand curve for steel to shift to the right. d) nothing to happen to steel because it is only a substitute for plastic. 2 . An upward sloping indifference curve defined over two goods violates which of the following assumptions from the theory of consumer behavior? a) preferences are complete. b) more is preferred to less. c) transitivity. d) all of the above 3 . Indifference curves are convex to the origin because of: a) transitivity of consumer preferences. b) the assumption of completeness.
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This note was uploaded on 03/06/2011 for the course ECON 303 taught by Professor Cheng during the Spring '07 term at USC.

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ECON303_PS1 - ECON 303: Intermediate Microeconomic Theory...

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