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Unformatted text preview: Economics 50 Stanford University Spring Quarter 2009 Page 1 of 18 Name: TA: Final Exam June 9, 2009 Part I (30 points total) Write your name and your TAs name ( Nadeem Karmali, Annika Todd, Takuro Yamashita, or Xiaoling Zhou), and sign the statement on the cover of Parts I, II, and III of the exam. Pace yourself carefully, and provide clear, concise answers lengthy explanations are not necessary! Write all of your answers in the space provided. If you need extra room, please use the back of each sheet. You can work on Parts I, II, and III in any order. If you must make any additional assumptions in order to answer a question, please state what those assumptions are. At least one member of the Econ 50 staff will be available outside the classroom at all times. We usually cannot answer questions, but please notify us if you feel youve found a mistake in the exam or if you observe a classmate engaging in suspicious behavior. At the end of the exam, turn in Part I, Part II, and Part III in the boxes provided. Your numerical answers should be as precise as possible. If youre pressed for time, dont worry about simplifying your answers perfectly. Make sure you show your work. You will have a total of 180 minutes to complete this exam. The exam is worth a total of 150 points, so you should allocate approximately one minute per point. Remember that no calculators, notes, books, headphones, or visible cell phones are allowed. Good luck! The answers written on these pages are entirely my own. I attest that in taking this exam, I am fully complying with all provisions of Stanfords Fundamental Standard and Honor Code. Signature: Do not open this exam until it is time to begin. Economics 50 Stanford University Spring Quarter 2009 Page 2 of 18 The (Multiple) Choice Is Yours [2 points each; 30 points total] For each of the following, indicate the best answer by clearly circling its letter (i.e. draw a circle around the letter a, b, c, d, or e). 1. Which of the following cost functions corresponds to the production function F ( L , K ) = [ L + K ] 1/ 2 ? a) TC = Q 1/2 min( w , r ) b) TC = ( w + r )Q 1/2 c) TC = Q 2 min( w , r ) d) TC = ( w + r )Q 2 e) None of the above. 2. Which of the following expressions is true in consumer theory? a) U ( X , Y ) / P Y = Y * ( P X , P Y , I ) b) U * ( P X , P Y , I ) / P Y = Y * ( P X , P Y , I ) c) I * ( P X , P Y , u ) / P Y = I * ( P X , P Y , u ) / P X d) I * ( P X , P Y , u ) / P Y = Y H ( P X , P Y , u ) e) None of the above. 3. Which of the following would not be a vertical line? a) The short-run conditional demand curve for labor, where F ( L , K ) = L 1/ 2 K 1/ 2 and capital is fixed at K = K ....
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