Micro Final Sample 2 Answers

Micro Final Sample 2 Answers - Principles of...

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Principles of Microeconomics: Final Exam, Sample #2, Answers Principles of Microeconomics Final Exam: Sample #2, Answers Duration - 3 hours No Aids Allowed Non-programmable calculators only INSTRUCTIONS: This examination consists of TWO PARTS Part I 10 diagrammatic/calculation questions of which you are expected to answer any EIGHT (10 marks each for a total of 80%). If you answer more than 8 questions, only the worst 8 marks will be counted. Part II 10 multiple choice questions worth 2 marks each for a total of 20%. Wrong answers will not be deducted from right in grading Part II. All questions are to be answered in the spaces provided in this question paper booklet Do not remove any pages or add any pages. No additional paper will be supplied. The blank backs of pages may be used for rough work. Show your work where applicable. Print your name and student number clearly on the front of the exam and on any loose pages. Student Name: ______________________________________________________ (Family Name) (Given Name) Student Number : ______________________________ There are 14 pages to the exam. - 1/14 -
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Principles of Microeconomics: Final Exam, Sample #2 PART I: Diagrammatic/Calculation: ANSWER ONLY 8 OF THE 10 QUESTIONS Place your answers (and work where necessary) in the space provided. 1. Demand and Supply (10 marks) The diagrams below represent the original equilibrium position for Old Age Homes, an inferior good. Home Nursing Services are a substitute in consumption for Old Age Homes and Meals are a complement in consumption. Bingo Games are a complement in production and Rental Apartments are a substitute in production for Old Age Homes. Labour is an input into production. Evaluate the statement given in each part to show the shift in the demand curve and/or the supply curve or movement along either curve in the short-run . Mark the new equilibrium price P1 and the new equilibrium quantity Q1. Designate Qs and Qd if there is no market equilibrium. Analyze each question independently of the other questions. No explanations are required. (2 marks per graph) a) The price of Rental Apartments increases and the price of Meals increases. 1 mark: Supply falls (shifts left) 1 mark: Demand falls b) Incomes increase due to an increase in old age pensions and Wages of workers increase. 1 mark: Demand decreases 1 mark: Supply falls (shifts left) c) The ‘Baby Boomer’ generation begins to require old age care and Bingo Games become more popular. 1 mark: Demand increases 1 mark: Supply increases (shifts right) d) The government substantially increases the licensing fee for Old Age Homes and there is a change in societal attitude towards more home care of older people by relatives. 1 mark: no change in supply
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This note was uploaded on 09/30/2011 for the course ECON 1000 taught by Professor Paschakis during the Spring '08 term at York University.

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Micro Final Sample 2 Answers - Principles of...

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