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Concordia University
ECON 201

Concordia UniversityDepartment of EconomicsECON 201INTRODUCTION TO MICROECONOMICSFall 2012COMMON FINAL EXAMINATION VERSION 1FIRST NAMELAST NAME STUDENT NUMBER Please read all instructions carefully1The exam consists of two parts iPart I 35 multiplechoice questions 35 marksiiPart II Choose 5 out of 6 long questions 65 marks2Write your name student ID and answers for the multiplechoice questions on the computer scansheet with a pencil Please also write the version of the exam on the computer scansheet For Part II write all your answers on this exam Do not use additional booklets 3You are allowed to use a nonprogrammable calculator and a paper dictionary provided that they are approved by the invigilators You may use either pen or pencil to provide your answers for Part II4You are not allowed to tear any pages out of this examGradesPart I Part II Total1Part I Multiple Choice Questions Write your answers on the computer sheet in PENCIL Total35 marks1With an infinitely elastic supply curve the incidence of a specific tax on a good will abe greater on the consumer if the demand curve is elasticbbe greater on the consumer if the demand curve is inelasticcwill be greater on the consumer if the D curve is moderately elasticdwill have the same incidence regardless of the demand elasticity2A basket of goods in 1987 cost 783 while the value of the same basket in 1997 was 1133 The value of this price index in 1997 based on 1987100 wasa1447b242c691d11743When economists compute the real value of an economic variable denominated in dollars they do so byadividing the nominal value by 100bmultiplying the nominal value by the price levelcdividing the nominal value by the price indexdsubtracting the price level from the nominal value and multiplying by 1004In the figure above if there is a shortage of 40 units what does this meanaPrice will fallbPrice must be 8cThe quantity traded is 40dBuyers would be willing to pay an additional 4 per unit for the quantity that they are now buying5In the figure above assume that the market was at equilibrium and that demand increases by 20 units What will be the new equilibrium price and quantityaPrice will rise by 2 and quantity traded will rise by 20 unitsbPrice will fall by 2 and quantity traded will fall by 20 unitscPrice will rise by 1 and quantity traded will rise by 10 unitsdPrice will fall by 1 and quantity traded will fall by 10 units6If goods J and K are substitutes an increase in the price of J causesaquantity demanded of J to fall and the demand curve for K to shift toward the originba decrease in quantity demanded for J and an outward shift of Ks demand curvecquantity demanded of J remains constant but the demand for K decreasesdthe demand curve for both J and K shift7Assume that spinach is a normal good Assume further that medical research has proven that eating spinach will reduce risks of cancer Due to economic recessionathere will be a leftward shift of the demand curvebthere will be a rightward shift of the demand curve2
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