Download Economic Thought

YORK UNIVERSITY
Faculty of Arts and Science
ECO429: Sample Questions
Duration - 3 hours: No Aids Allowed
ANSWER ALL QUESTIONS IN THE BOOKLETS PROVIDED.
This exam has two parts.
Part I: Short-answer questions worth a total of 40 marks.
Part II: Essay style questions worth a total of 60 marks.
PART I: (40 marks)
GIVE A BRIEF ANSWER FOR 20 OF THE FOLLOWING 26 QUESTIONS
EACH CORRECT ANSWER IS WORTH TWO MARKS.
1. What is Cournot’s ‘Law of Demand’? What was his function for the Law of
Demand?
2. How does Cournot’s understanding of demand reflect his ‘partial’ analysis?
3. What determines maximum profit for a monopolist according to Cournot?
4. What do we mean by the utilitarian (Benthamite) approach of Jevons?
5. How (i.e., through what means) does Jevon’s derive his utility precepts?
6. What does it mean to say that Jevon’s had a cardinal, not ordinal, concept of utility?
7. What determines the ‘final degree of utility” of a commodity for Jevons? How does
this final degree of utility change?
8. How does Jevon’s propose to measure utility?
9. What role does the ' Law of Indifference' play in Jevons' theory?
10. What is formula for the ‘ratio of exchange’ of two commodities between two
individuals for Jevons?
11. How did Cost of Production determine Final Degree of Utility for Jevons (the
catena)?
12. Why did Jevons essentially accept Ricardo’s theory of rent?
13. How is time essential in Jevons’ theory of interest?
14. What is the significance of the atomistic and subjective method in Menger?
15. Why do we say that Menger (and Jevons) assume cardinal not ordinal utility?
16. How is Menger’s concept of a change in utility different from Jevons’?
17. What determines the optimal allocation of ‘available means’ for an ‘economizing
individual’ according to Menger?
18. Why is there a range of price in barter between two individuals for Menger?
19. How does Menger determine the contribution of a factor input in the fixed factor
proportions case?
20. What is the difference between consumer goods and capital goods for Walras?
21. What is the difference between social wealth and services for Walras?
22. What is the relationship between value in exchange and rarété for Walras?
23. What is the numeraire for Walras? What is its significance for the price equations?
24. How does an offer function differ from a demand function for Walras?
25. Give two reasons why Walras general equilibrium solution does not guarantee an
economic equilibrium.
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ECON4069 FINAL EXAM, April 23, 2004
26. Give 3 of the 4 equilibrium conditions for the market for Walras.
27. What is the significance of the auctioneer and ‘tatonnement’ for Walras?
28. Why is Marshallian partial equilibrium not necessarily inferior to Walrasian
general equilibrium as a general equilibrium approach?
29. What is the general equilibrium (Fisher, for example) criticism of Marshall’s
additive utility function?
30. What is the problem with Marshall’s assumption of a constant marginal utility of
money?
31. Why is Price on the vertical axis and Quantity on the horizontal axis in the
Marshallian Demand Curve?
32. When is entrepreneurial profit equal to zero (as in Walras) according to Marshall?
33. What does Marshall mean by the real cost of labour and capital?
34. What was the significance of the ‘representative firm’ for Marshall?
35. What was the ‘period of production’ for Bohm-Bawerk?
36. What is the ‘roundabout’ feature that is essential to capital for Bohm-Bawerk?
37. Why does an increase in capital imply a decreasing rate of return for BohmBawerk?
38. What is the function of the rate of interest in Bohm-Bawerk’s system?
39. What was Fisher’s equation of exchange (money equation)?
40. What assumptions did Fisher make to derive the quantity theory of money from his
equation of exchange (money equation)?
41. What determines the nominal rate of interest according to Fisher?
42. What determines the real rate of interest according to Fisher?
43. What do we mean by ‘intertemporal indifference curves’ in reference to Fisher?
44. Why is equilibrium not necessarily at full employment according to Keynes?
45. What is Keynes's criticism of the 'classical' savings function?.
46. What is the liquidity preference function for Keynes?
47. What determines the limit of business investment according to Keynes?
48. What defines the marginal efficiency of capital for Keynes?
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