100b practice questions for final(2)

# 100b practice questions for final(2) - Econ...

This preview shows pages 1–2. Sign up to view the full content.

Econ 100B (Grossman)—Winter 2010 Practice questions for final exam With answers March 9, 2010 If you can do the blue-book questions from the two midterms, plus these practice questions, you should be in good shape for the blue-book/free-response section of the final. The questions that will be on the exam have been designed so that the numbers typically work out relatively “nicely”. I haven’t taken such care here, so don’t be surprised or scared if you get less “nice” numbers. 1. Consider an exchange economy consisting of two people, A and B , endowed with two goods, 1 and 2. The endowments are ω A = (0 , 5) and ω B = (5 , 5). Preferences are given by U A ( x 1 , x 2 ) = x 2 1 x 2 and U B ( x 1 , x 2 ) = x 1 x 2 . Find the competitive equilibrium prices and allocations. Answer : x A = (10 / 7 , 5 / 3), x B = (25 / 7 , 25 / 3) and p = (7 / 3 , 1) (or any scalar multiple of these prices). 2. Firm 1 produces good x and firm 2 produces good y . Both operate in competitive markets in which p x = 50 and p y = 50. Firm 1’s costs are given by c 1 ( x ) = 100 + x 2

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

### What students are saying

• 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.

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

• 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.

Dana University of Pennsylvania ‘17, Course Hero Intern

• 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.

Jill Tulane University ‘16, Course Hero Intern