3390 Managerial Economics Practice Questions
1. If a decision is to be sensible, what must be incorporated?
a. A listing of the alternative courses of action.
b. Determining how varying the assumptions affects the problem.
c. A statement of goals and obje
Part B. Solve the following problems.
1. The price elasticity of demand for Magic personal computers is estimated to be -3.0.
If the price of the computers declines by 20%, what would be the expected percentage (%)
changes in the quantity sold and in tota
ECONOMICS 3390
EXCECISE QUESTIONS I and ANSWERS
Professor Dr. Choi
Part A. TECHNIQUES OF OPTIMIZATION: Differential Calculus
1) Solve the following equations by factoring, and find the roots.
a) P2 + 4P -5 = 0
Ans: (P+5)(P-1) = 0, so P= -5, 1.
b) X3 + 2X2
EXERCISE QUESTIONS I (Chapter 1, 2, 3, 4)
ECONOMICS OF THE FIRM (ECONOMICS 3390)
Professor: Dr. Choi
Part A. True-False Questions: Answer : True: T, False: F
1. Globalization increases trade and investment opportunities, but decreases risks and
uncertaint
EXERCISE QUESTIONS
ECONOMICS OF THE FIRM (ECONOMICS 3390)
1. Where the demand is price elastic, marginal revenue is positive
Answer: T.
2. If a price floor above the equilibrium price is imposed by the government in a market
surpluses of the good will dev
ECONOMICS 3390
EXCECISE QUESTIONS I and ANSWERS
Professor Dr. Choi
Part A. TECHNIQUES OF OPTIMIZATION: Differential Calculus
1) Solve the following equations by factoring, and find the roots.
a) P2 + 4P -5 = 0
Ans: (P+5)(P-1) = 0, so P= -5, 1.
b) X3 + 2X2
Chapter 4. Demand Theory
This chapter is about consumer behavior.
(1) The Law of Demand: P and Qd for a good are inversely related,
ceteris
paribus.
Price effect (PE) on Qd consists of Substitution Effect (SE) and
Income
Effect (IE). That is,
PE = SE + IE
Chapter 3: Optimization techniques and new Management Tools
OPTIMIZATION AND BASIC DIFFERENTIAL CALCULUS (in
Chapter 3
Appendix)
Decision making processes involve optimization, and the
optimization
requires understanding of several rules of differentiatio
Chapter 2.
Demand and Supply, and Equilibrium Analysis
We will briefly cover this chapter because it was a major subject of
the principles
course (Econ 2302).
(1) Market
(A) Market: A mechanism or an institution which brings buyers
and
sellers of a good o
KEY CONCEPTS I (ECON 3390)
MANAGERIAL ECONOMICS (Fall 2013)
.
Chapter 1. Introduction
(1) Economics: is the study of the way in which scarce resources
are allocated
among alternative uses to satisfy unlimited human wants.
(A) Objectives of learning econom