Class Notes (1,100,000)
CA (620,000)
Carleton (20,000)
ECON (300)
ECON 1000 (200)
P J (3)
Lecture 1

ECON 1000 Lecture Notes - Lecture 1: Bundesautobahn 59, Tax Incidence, Perfect Competition


Department
Economics
Course Code
ECON 1000
Professor
P J
Lecture
1

Page:
of 29
0
University of Ottawa
Department of Economics
ECO1104A - INTRODUCTION TO MICROECONOMICS
Final Examination
Professor David Gray Fall 2007
You may not consult with any written documents whatsoever, and no conversation is permitted
while the examination is in progress. Turn off all cellular telephones. No programmable calculators
or palm pilots are permitted. It is forbidden to look at other students’ papers. There are 100
multiple choice questions, and the allotted time is three hours. It may not necessarily be the case that
3 of the responses are totally wrong, and one of them is unambiguously correct. In such situations,
select the best answer. Respond to the questions on the scan-tron sheet. Please grid in your name
and your student number by filling in the appropriate ovals in each column. If you use red ink, no
score will be recorded for you. If you use ink of another color, the scanner can pick up your
responses, but you cannot change them. You are advised to use a pencil. You must grid in the ovals
below each digit of your student number, and below each letter of your name.
1
1. All of the following are among the basic principles of microeconomics that we have studied in this
course except:
a. Markets are usually a good way to organize economic activity
b. Trade can make everyone better off
c. Rational People think at the margin
d. All of the above apply
D
2. All of the following are among the basic principles of microeconomics that we have studied in this course
except:
a. The cost of something is aligned with the benefit that one derives from it
b. Trade can make everyone better off
c. Rational People think at the margin
d. People Face Tradeoffs
A
3. All of the following are among the basic principles of microeconomics that we have studied in this course
except:
a. Markets are usually a good way to organize economic activity
b. Trade can make everyone better off
c. People respond to incentives
d. Total surplus is a measure of the well-being of a population
D
D
4. All of the following are among the basic principles of microeconomics that we have studied in this course
except:
a. Free markets always yield efficient outcomes
b. Trade can make everyone better off
c. Rational People think at the margin
d. People Face tradeoffs
A
5. By a scientific method of investigation we mean:
a. The use of modern electronic testing equipment to understand the world.
b. The dispassionate development and testing of theories about how the world works.
c. The use of controlled experiments in understanding the way the world works.
d. finding selective evidence to support preconceived theories about how the world works.
B
6. On a production possibilities frontier, production is said to be efficient if the production point is:
a. on the frontier.
b. outside the frontier.
c. on or inside the frontier.
d. inside the frontier.
A
2
7. Which of the following statements regarding international trade is NOT correct?
a. Trade allows for specialization.
b. Trade can lead to higher living standards
c. Trade is based on absolute advantage.
d. Trade allows individuals to consume outside of their individual production possibilities
curve.
C
8. Suppose a gardener produces both green beans and corn in her garden. If she must give up 13 bushels of
corn in order to get 5 bushels of green beans, then the opportunity cost of 1 bushel of green beans is:
a. 0.38 bushel of corn.
b. 2.6 bushels of corn.
c. 8 bushels of corn.
d. 18 bushels of corn.
B
9. If Shawn can produce doughnuts at a lower opportunity cost than Sue, then:
a. Shawn has a comparative advantage in the production of doughnuts.
b. Sue has a comparative advantage in the production of doughnuts.
c. Shawn should be retrained and produce a different product.
d. it is obvious that Shawn is capable of producing more doughnuts than Sue.
A
10. Belarus has a comparative advantage in the production of linen, but Russia has an absolute advantage in
the production of linen. If these two countries decide to trade:
a. Belarus should export linen to Russia.
b. Russia should export linen to Belarus.
c. For these two countries, trading linen would be a "stand-off" so they should trade another
product.
d. Without additional information about Russia, this question cannot be answered.
A
11. Which of the following would NOT be a determinant of demand?
a. The price of related goods
b. Income
c. Tastes
d. The prices of the inputs used to produce the good
D
12. An example of an inferior good might be:
a. neckties.
b. Macaroni and cheese dinners
c. cloth napkins.
d. Cut flowers.