Econ 101: Updated Midterm 2 Review
All homework problems are important. Please go over them along with the extra problems. Answer
keys for the homeworks are posted on my website.
I have added problem # 25 and 26 (diagrams).
Try the problems on your own first.
Chapter 6:
1. End of chapter 6 Problem # 20 (HW # 4) (
Important
)
Chapter 7:
2. End of chapter 7 Problem # 2, 4, 15 (HW # 4)
3. A firm has a marginal cost of $20 and charges a price of $40. The Lerner index for this firm is:
A.
0.20.
B.
0.50.
C.
0.33.
D.
0.75.
4. An industry is comprised of 20 firms, each with an equal market share. What is the 4firm
concentration ratio of this industry?
A.
0.2.
B.
0.4.
C.
0.6.
D.
0.8.
5. A Lerner index of 0 suggests
A.
monopoly.
B.
monopolistic competition.
C.
oligopoly.
D.
perfect competition.
6. An industry consists of six firms with annual sales of $300, $500, $400, $700, $600, and $600,
respectively. What is the industry's C
4
?
A.
0.58.
B.
0.62.
C.
0.74.
D.
0.77.
This preview has intentionally blurred sections. Sign up to view the full version.
View Full Document7. Suppose that there are two industries, A and B. There are five firms in industry A with sales at $5
million, $2 million, $1 million, $1 million, and $1 million, respectively. There are 4firms in industry B
with equal sales of $2.5 million for each firm. The HHI for industry A is
This is the end of the preview.
Sign up
to
access the rest of the document.
 Spring '11
 dude
 Economics, Oligopoly, B., c., Cournot C. Bertrand

Click to edit the document details