ex407m3sp0907

ex407m3sp0907 - MGMT 407.07 Spring 2009 MIDTERM 3 NAME_...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
MGMT 407.07 Spring 2009 MIDTERM 3 NAME_______________________ This is an open-book and open-notes examination. Full credit will be given only when the entire solution process and calculations are shown. Assume prior results are correct in multipart questions. 1. (55 points and 30 minutes) Suppose the firms in a competitive industry are faced with the following cost function: TC = 36 - Q + 4Q 2 (10) a. How many units should be produced at a price of 8? (20) b. What is the optimal production per firm and the price in the long run? (5) c. How many units should you produce at P = 1.5? (20) d. What is the contribution to fixed cost and profit, when P = 1.5? 2. (35 points and 20 minutes) Suppose you are a monopolist facing a demand curve of Q = 45 – 3 P, and marginal costs are constant at $6 per unit. (10) a. Compute the monopoly price, quantity and profit. (15) b. Now suppose that the monopolist can engage in first-degree price discrimination at a cost of $7 per unit. What are the profits of this option? (10) c. Draw a diagram of the above results. . 3. (20 points and 10 minutes) What arguments support the idea: ‘gross domestic product per capita is a poor measure of the welfare of the citizens of a country.’ 4. (55 points and 30 minutes) Assume all schedules have nonextreme shapes and that the
Background image of page 1

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

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 10/25/2011 for the course MGMT 407 taught by Professor Staff during the Spring '11 term at S.F. State.

Page1 / 4

ex407m3sp0907 - MGMT 407.07 Spring 2009 MIDTERM 3 NAME_...

This preview shows document pages 1 - 2. Sign up to view the full document.

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