Midterm 2008 Answer - Econ 110 L3 L4(circle your lecture Name Spring 2008 Student ID Midterm Exam Tutorial Instructor Yan YU Total Score VERSION A

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(circle your lecture #) Name: Spring, 2008 Student ID: Midterm Exam Tutorial #: ______________ Instructor: Yan YU Total Score: VERSION A General instruction: You have 100 minutes for this exam. You may use calculators if necessary. There is a total of 9 pages. Please check first to see if you have all pages. I. Multiple choices (circle one correct answer for each question on the answer sheet for multiple choices , 3 points each, 75 points total) 1. Which of the following questions is a topic that would be studied by microeconomics? A) Why did production and the number of jobs shrink in 2001? B) Will the current budget deficit affect the well-being of the next generation? C) How will a lower price of digital cameras affect the quantity of cameras sold? D) What is the current unemployment rate in the United States? 2. The existence of the tradeoff along the PPF means that the PPF is A) bowed outward. B) linear. C) negatively sloped. D) positively sloped 3. According to the figure above, the opportunity cost of producing another computer is A) higher at A. B) higher at B. C) the same at every point along the frontier. D) different at most points along the frontier but equal at points A and B because they are equally distant from the axes. 1

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4. Missouri can produce 10,000 tons of pecans per year or 5,000 tons of pears per year. Washington can produce 12,000 tons of pecans per year or 48,000 tons of pears per year. Which of the following statements is true? A) Washington has an absolute advantage in the production of both pecans and pears. B) Washington has a comparative advantage in the production of both pecans and pears. C) Washington has a comparative advantage in producing pecans and Missouri has a comparative advantage in producing pears. D) Both answers A and C are correct. 5. In the figure above, suppose that Mac and Izzie specialize and trade to reach point c. Mac sends Izzie A) 12 computers in exchange for 12 TVs. B) 12 computers in exchange for 6 TVs. C) 6 computers in exchange for 12 TVs. D) 6 computers in exchange for 6 TVs. 6. A person who has an absolute advantage will A) not have a comparative advantage in everything. B) have a comparative advantage in everything. C) not specialize.
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This note was uploaded on 06/16/2011 for the course ECON 110 taught by Professor Tan during the Spring '07 term at HKUST.

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Midterm 2008 Answer - Econ 110 L3 L4(circle your lecture Name Spring 2008 Student ID Midterm Exam Tutorial Instructor Yan YU Total Score VERSION A

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