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ECON201 Final.doc

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Concordia University
ECON 201

Concordia UniversityDepartment of EconomicsECON 201INTRODUCTION TO MICROECONOMICSFall 2011COMMON FINAL EXAMINATION VERSION 2FIRST 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 answers for the multiplechoice questions on the computer scansheet with a pencil 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 dictionary You may use either pen or pencil to provide your answers for Part IIGradesPart I Part II Total1Part I Multiple Choice Questions Write your answers on the computer sheet in PENCIL Total35 marks1Dave is riskaverse while Scott is riskneutral Both are confronted with the following gamble win 5000 with the probability of 65 or lose 9000 with a probability of 35 One can predict thataboth will accept the gamblebonly Scott will accept the gambleconly Dave will accept the gambledScott will accept and Dave may accept2Suppose you are told that total costs TC depend on output Q as follows TC1007Q You can infer therefore that fixed costs area100b100Qc7d1073The unregulated profitmaximizing monopolist will always produceaat that output level where total revenue is maximizedbabove the midpoint of its demand curvecwhere marginal revenue is zerodin the inelastic range of its demand curve4One of the major similarities between perfectly competitive markets and monopolistic competition is thatafirms can enter or leave either market very easilybeach type of market exhibits standardized productscthe demand curve faced in each type of market is horizontaldcompetition not based on prices occurs in both5Which one of the following statements is correctaMonopolist supply curve is a horizontal linebUnregulated monopoly will keep on increasing pricecUnregulated monopoly will not set the price where MRMCdUnregulated always makes economic profits in both shortrun and longrun6Which of the following is not a requirement of a gameaPlayersbPayoffscDominant strategiesdKnowledge of the payoffs7Suppose Canada eliminates tariffs on Chinese bicycles As a result we would expectathe price of Chinese bicycles to decline in Canadabemployment to increase in the Chinese bicycle industrycemployment to decrease in the Canadian bicycle industrydall of the above to occur8 When countries specialize in producing and exporting the goods that they produce at a lower relative cost than other countries the distribution of the gains from tradea depends on who produces and trades what productsb depends on the terms of trade which lie between the countries domestic opportunity costcprovides equal benefits for all countriesdis unrelated to the bargaining power of participants9Use the following table to answer the questionQuantity12345678910Price65605550454035302520Referring to table above what is the marginal revenue of the 6th unita6b10c15d452
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