Download Test #2 Preview

ECON 2306 Test #2 PREVIEW SHEET
1.
2.
3.
4.
What is meant by utility? … isoutility?
What is meant by marginal utility?
What is the formula for marginal utility?
What is the formula for a budget constraint
if only two goods may be purchased?
5. What is the slope of the budget constraint?
6. What is the slope of the isoutility curve?
7. What are the characteristics of an isoutility
curve?
8. What is meant by “intransitivity”?
9. What is the formula for consumer
equilibrium? … producer equilibrium?
10. What happens to a budget constraint when
the price of one good changes? … when
more income is received?
11. How are the vertical and horizontal
intercepts of a budget constraint
determined?
12. How can an individual’s demand curve for
a good be determined using isoutility
curves and budget constraints?
13. What is meant by the law of demand?
14. What is meant by production?
15. What is the formula for a Cobb-Douglas
Production Function?
16. What is meant by returns to scale?
17. How can a Cobb-Douglas Production
function be used to determine returns to
scale?
18. What is meant by the marginal product of
labor (MPL)?
19. What is meant by the marginal product of
capital (MPK)?
20. How can a Cobb-Douglas Production
Funtion be used to calculate MPL & MPK?
21. How does a short-run production function
differ from a long-run production function
(graphically)?
22. What is meant by “isoquant”?
23. How does “isoquant” differ from
“isoutility”?
24. What is meant by the law of diminishing
marginal utility?
25. What is meant by the law of diminishing
marginal product?
26. How does the concept in #24 differ from
that of #25 (above)?
27. What are the three stages of production in a
short-run production function?
28. How can a production function be used to
determine the marginal product of labor?
29. How can a production function be used to
determine the average product of labor?
30. What is the formula for MPL? … APL?
31. How do MPL and APL relate to the cost
curves?
32. How does the Total Product curve relate to
the cost curves?
33. What ways can production be related to
cost?
34. What are meant by fixed costs? … variable
costs?
35. What are the formulae for TC? TFC? TVC?
36. What are the formulae for ATC? AFC?
AVC?
37. What are the formulae for MC? …MR?
38. What is the formula for profit
maximization?
39. What is the formula for cost-minimization
of all inputs?
40. What is known about TC and TFC when
output is equal to zero? Why?
41. In terms of types of cost, what things are
equal when output is equal to zero? …to
one?
42. What are the shapes of TC, TFC, and TVC?
43. What are the shapes of ATC, AFC, and
AVC?
44. What is the shape of MC?
45. How does MC relate to ATC and AVC ?
46. How does ATC relate to AVC
(graphically)?
47. How does the MPL curve relate to MC?
48. How does the APL curve relate to AVC?
49. How is a long-run ATC curve derived?
50. What is meant by “lumpy facilities”?
51. What is meant by increasing returns to
scale?
52. How does returns to scale differ from
economies of scale?
53. What are the reasons for economies of
scale?
54. What is meant by MES?
55. What is meant by diseconomies of scale?
56. What are the formulae for profit?
57. What is the formula for profitmaximization (i.e., a profit-maximizing
condition)?
58. What is meant by MR and MC?
59. What should a profit-maximizing firm do if
MR>MC? MR<MC? MR=MC?
60. What is the slope of TR? … TC?
61. What is meant by perfect competition?
62. What are the ways in which a market
structure can be characterized?
63. What is the formula for “economic profit”?
... normal profit? …loss-minimization?
…shutdown?
64. What determines whether a firm should
shut down or continue to operate at a loss?
65. In terms of high-fixed cost or low fixed
cost firms, what types of firms are more
likely to shutdown?
66. In terms of high-fixed cost or low fixed cost
firms, what types of firms are more likely to
operate at a loss?
67. In the short run, a firm must be able to
cover which type of cost in order for it to
make sense for the firm to operate?
68. Be able to fill out a COST TABLE!
69. What are the types of market structures?
70. What is meant by monopoly? …duopoly?
…oligopoly? …monopolistic competition?
71. What is meant by a price-taker? … price
maker?
72. How is the demand curve for a firm in
perfect competition determined?
73. What are the various things that the
demand curve for a PC firm equals?
74. What is one item which a PC firm controls
in the marketplace?
75. Graphically, what determines the level of
output which a PC firm should produce?
76. What are the various misperceptions
regarding firms operating as a monopoly?
77. How does one determine the level of
output and price for a monopoly?
78. How does one determine profit for a firm
in monopoly?
79. What is the formula for profit?
80. Graphically, how can the formula for profit
be used in the case of monopoly?
81. What is the MR curve for a PC firm?
82. What is the MR curve for a monopoly?
83. Why might one describe a monopoly as
being “evil”?
84. What is the formula for “allocative
efficiency”? …productive efficiency?