2009Final_12112009-1

2009Final_12112009-1 - Name: _ Date: _ Microeconomics 2010...

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Version 1 Page 1 Name: __________________________ Date: _____________ Microeconomics 2010 final, sec. 300. Fall 2009 (Version 1) The exam has 123 questions. Make sure you have all 123 questions (28 pages) 1. If the price of tacos increases from $1 to $2, and customers decrease their consumption from 10 tacos to 8 tacos, what is the price elasticity of demand, using the midpoint method? A) 1/2 B) 3/2 C) 1 D) 1/3 2. A cost that does not depend on the quantity of output produced is called a: A) fixed cost. B) variable cost. C) average cost. D) marginal cost. Use the following to answer question 3: Figure: Marginal Product of Labor
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Version 1 Page 2 3. (Figure: Marginal Product of Labor) Using the marginal product of labor curve in the figure, the total product of labor for three workers is: A) 45 bushels. B) 15 bushels. C) 51 bushels. D) 39 bushels. 4. An external benefit is a(n): A) benefit that individuals or firms confer on others without receiving compensation. B) example of a negative externality. C) benefit that accrues to domestic firms due to the actions of foreign (external) firms. D) benefit that accrues to foreign (external) firms due to the actions of domestic firms. 5. To produce 10 deep-fried cats one must choose an input combination on the isoquant for 10 deep-fried cats. A) True B) False 6. Consider the total quantity of goods produced. Consider bundles A and B, where B contains all that is in A, plus some more goods. Bundle A is necessarily less efficient than bundle B A) True B) False 7. Total revenue is a firm's: A) total output times the price at which it sells that output. B) change in revenue resulting from a unit change in output. C) ratio of revenue to quantity. D) difference between revenue and cost. 8. Average total cost is: A) total cost divided by output. B) total cost times output. C) the change in cost divided by the change in output. D) the change in output divided by the change in costs.
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Version 1 Page 3 9. The presence of an external negative effect implies the market is failing. A) True B) False Use the following to answer question 10: 10. (Table: Labor and Output) Referring to the table, the average product when four workers are employed is: A) 36. B) 10. C) 6. D) 9. Use the following to answer question 11: Figure: MSB and MSC of Pollution
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Version 1 Page 4 11. (Figure: MSB and MSC of Pollution) The accompanying graph shows the marginal social cost and marginal social benefit of pollution. If the current level of pollution is at Q 1 : A) the socially optimal amount of pollution is being emitted, as the MSB = MSC. B) not enough pollution is being emitted, as the MSB > MSC. C) not enough pollution is being emitted, as the MSB < MSC. D) too much pollution is being emitted, as the
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2009Final_12112009-1 - Name: _ Date: _ Microeconomics 2010...

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