Midterm2_fall08_8am_formA

Midterm2_fall08_8am_formA - Midterm 2 Economics 304K:...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
1 Midterm 2 Economics 304K: Principles of Microeconomics Prof. Meg Ledyard Fall 2008, TTH 8am – 9:30 am (33790) 60 Min. Name _____________________ UT EID ____________________ FORM A You have 60 min for the exam. There are a total of 100 points. You may NOT use calculators or other aids. You may leave any fractions un-simplified. Please show all of your work on the following pages. If you need more space, please use the back. Properly label all graphs. Make sure that you include your test form on your multiple choice answer sheet. You should have 9 pages including this one. Please count them to be sure.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2 Question 1 (26 points) Consider the perfectly competitive market for bloomin’ onions in the small land of Steakland. Suppose that the no trade price of bloomin’ onions is 5. The world price of bloomin’ onions is 2. The government of Steakland decides to open to trade and impose a tariff of 1 on the market for bloomin’ onions. a.(14 points) In a clearly labeled diagram, show the market for bloomin’ onions when there is trade with the tariff. b. (12 points) Label the consumer surplus, producer surplus, government revenue, and deadweight loss with the tariff. You can either clearly label them above, or you can label the graph and write the areas below:
Background image of page 2
3 Question 2 (14 points) Consider the perfectly competitive market for grilled bratwurst. The perfectly competitive market for grilled bratwurst exhibits a negative externality of $2 per bratwurst. The price elasticity of demand for grilled bratwurst is 0.25. The price elasticity of supply for grilled bratwurst is 2.2 (make sure you include this in your diagram). a.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 10/11/2011 for the course ECO 304K taught by Professor Hickenbottom during the Spring '10 term at University of Texas.

Page1 / 9

Midterm2_fall08_8am_formA - Midterm 2 Economics 304K:...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online