{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

sample midterm1 - Economics 360B Microeconomic Theory State...

Info icon This preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Economics 360B: Microeconomic Theory State University of New York at Binghamton Department of Economics Spring, 2007 Midterm I Version A The exam is worth 100 points. Each question (six questions on one page) is of equal value. There will be no communication with the exam proctors; if you believe a question contains an error or ambiguity, say so on your written examination, make an assumption to correct the alleged error or to resolve the ambiguity, and answer the question as well as you can. [1] The MRS of food (vertical axis) for shelter (horizontal axis) measures the amount of food that must be received in order to absorb the loss of 1 unit of shelter without losing utility (do not assume that these goods are perfect substitutes). If that value is 1, if the price of food is 10, and if the shelter price is 5, then the consumer is not maximizing their utility. Sketch a budget line, assuming the consumer has $500 to spend, and draw in a possible indifference curve that illustrates the situation described here.
Image of page 1
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern