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Unformatted text preview: Econ 100B (Grossman)Winter 2010 Final ExamVersion A March 16, 2010 Instructions: This is a closed-book, closed-notes exam. No calculators or electronic devices are allowed. Please turn off and put away all phones and other electronic devices. There are 14 multiple-choice questions and two free-response questions. Answer as many as you can in the time allowed. If you get stuck on something, I suggest moving on and coming back later when/if you have time. If you have a question, please raise your hand. Good luck! Multiple choice 29 out of 50 pts. (14 qns., 2 pts. each + 1) Answer these questions on your Scantron. Your score will only be based on the marks on your Scantron. You will not receive any credit for anything written on your exam paper. You will receive 1 point for correctly writing (and bubbling in) your name, perm number, version (A,B,C, or D), and TAs name on your Scantron. 1. In the competitive widget industry, the demand is q = 100- p and the supply is q = p- 40. What is the deadweight loss if the government imposes a tax of 20 per widget? (a) 200 (b) 500 (c) 100 (d) 400 2. You have $9 and preferences given by u ( w ) = w . Which of the following options is most attractive? (a) Get a free lottery ticket that has a 1 in 3 chance of winning $91 (b) Pay $5 for a lottery ticket that has a 50-50 chance of winning $21 (c) Do nothing (d) Pay all your money ($9) for a lottery ticket that has a 1 in 4 chance of winning $100 3. A monopolist faces inverse demand p = 190- 5 q and zero costs. What is the profit-maximizing level of output? (a) 29 (b) 10 (c) 19 (d) 9.50 4. Emmon is the sole supplier of Fanta in Santa Barbara. Inverse demand for Fanta is given by p = 120- 2 q and each Fanta costs 20 to import. Because Emmon is psychic, he practices 1st degree (perfect) price discrimination. How much Fanta does he provide? (a) 80 bottles (b) 40 bottles (c) 50 bottles (d) 100 bottles 1 5. Two coffee shops compete as Cournot duopolists. The inverse demand for coffee is p = 2- Q , where Q is total amount produced by the two shops. Each shop has the same cost function c ( q ) = 2 q 2 . What is total equilibrium output?...
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