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Midexam
Economics
Dr. Chien-Ho Wang
November 27, 2013
期中考為關書考試, 做弊以零分計算. 請於考試時關閉手機. 此考試可攜帶計算
機. 請依據課本內容, 看清題義作答. 做答時請對所有題目(選擇題及計算題)詳
列作答理由及計算步驟, 理由及步驟不清不予記分. (共 7 頁)
題目隨答案卷繳回 請在兩份考卷 (題目卷及答案卷)寫上姓名.
1.
A good is said to be a normal good when
(a). decreases in income lead to an increase in demand for the good
(b). decreases in income lead to a decrease in demand for the good
(c). increases in income lead to a decrease in demand for the good
(d). increases in price lead to a decrease in the quantity demanded of the good
2.
Figure 1
Price
Quantity
Quantity
Per Pair
Demanded
Supplied
$ 2
$ 4
$ 6
$ 8
$10
18
14
10
6
2
3
4
5
6
8
Figure 1 shows the supply and demand for socks. If a price floor of $6 is imposed, the
quantity of socks actually purchased will be
(a). 10 pairs
(b). 5 pairs
(c). 6 pairs
(d). 15 pairs
3.
If the price elasticity of demand for Cheer detergent is 3.0, then a
a. 12 percent drop in price leads to a 36 percent rise in the quantity demanded
b. 12 percent drop in price leads to a 4 percent rise in the quantity demanded
c. $1,000 drop in price leads to a 3,000-unit rise in the quantity demanded
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d. $1,000 drop in price leads to a 333-unit rise in the quantity demanded
4.
If a 20 percent decrease in the price of chicken results in a 10 percent increase in the
quantity demanded, the price elasticity of demand has a value of
(a). 0.1
(b). 0.5
(c). 1
(d). 2
5.
If the income elasticity of demand is negative, this means that the good is
(a). an normal good
(b). sold at a lower than equilibrium price
(c). provided by competitive producers
(d). a inferior good
6.
To produce a firm's current output level, total cost is $600, and the total variable cost is
$450. Therefore, the firm has
(a). a marginal cost of $150
(b). sunk costs of $150
(c) . total fixed cost of $1,450
(d). total fixed cost of $150
7.
If there are diminishing marginal returns to labor,
(a). the management team grows as more workers are hired
(b). the management team shrinks as successive workers are added
(c). the rise in output becomes smaller and smaller with each successive worker hired
(d). macroeconomic business cycles are generated by microeconomic production
functions
8.
For every firm that faces a downward-sloping demand curve for its output,
(a).
(b).
(c).
(d).
9.
marginal cost exceeds marginal revenue at all output levels
marginal revenue equals the price of the last unit sold
marginal revenue is less than the price of the last unit sold
marginal revenue exceeds the price of the last unit sold
Flora's Flowers operates in a perfectly competitive market. At the point where marginal
cost equals marginal revenue, ATC = $10, AVC = $5, and the price per unit is $15. In
this situation,
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(a). Flora earns positive profits in the short run
(b). Flora will shut down in the short run
(c). Flora's supply curve will shift to the left
(d). Flora's supply curve will shift to the right
10. In the long run in a competitive market,
(a). existing firms can increase their plant size, and new firms can enter the market
(b). existing firms can increase their plant size, but the number of firms is the market
is fixed
(c). new firms can enter the market, but existing firms cannot vary their plant size
(d). new firms can enter the market, but only if existing firms decrease their plant size
in the short run
11. If a profit-maximizing monopolist faces a downward-sloping market demand curve, its
.
(a). average revenue is less than the price of the product.
(b). average revenue is less than marginal revenue.
(c). marginal revenue is less than the price of the product.
(d). marginal revenue is greater than the price of the product.
12.
Figure 1
Price
Curve C
Curve D
P5
P4
P3
P2
P1
P0
Curve B
Curve A
Quantity
Q1 Q2 Q3 Q4
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Refer to Figure 1. A profit-maximizing monopoly will charge a price of
(a). P5.
(b). P4.
(c). P3.
(d). P2.
13. Which of the following conditions distinguishes monopolistic competition from perfect competition?
(a). the number of sellers in the market
(b). the freedom of entry and exit by firms in the market
(c). the size of firms in the market
(d). product differentiation
14. Table 2
This table shows a game played between two players, A and B. The payoffs in the table are
shown as (Payoff to A, Payoff to B).
B
Right
Left
Up
(2, 2)
(3, 1)
Down
(1, 3)
(0, 0)
A
If player A chooses his/her best strategy, player B should
(a). choose right and earn a payoff of 2.
(b). choose right and earn a payoff of 3.
(c). choose left and earn a payoff of 1.
(d). choose left and earn a payoff of 0.
15. When firms have agreements among themselves on the quantity to produce and the price at which to sell
output, we refer to their form of organization as a
(a). Nash arrangement.
(b). cartel.
(c). monopolistically competitive oligopoly.
(d). perfectly competitive oligopoly.
16.
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Table 2
Suppose that a firm in a competitive market faces the following revenues and costs:
Quantity
Total Revenue
Total Cost
0
$0
$3
1
$7
$5
2
$14
$9
3
$21
$15
4
$28
$23
5
$35
$33
6
$42
$45
7
$49
$59
At which level of output in the table is average variable cost equal to $6?
(a). 2 units
(b). 3 units
(c). 4 units
(d). 5 units
17.
Figure 2
Suppose that a firm in a competitive market has the following cost curves:
Price
13
12
11
MC
10
9
ATC
8
AVC
7
6.3
4.5
6
5
4
3
2
1
1
2
3
4
5
6
7
8
9
10
11
Quantity
5
18. The firm should shut down if the market price is
(a). above $8.
(b). above $6.30 but less than $8.
(c). above $4.50 but less than $6.30.
(d). less than $4.50.
Figure 3
Cost
D
11
C
10
B
9
8
7
6
5
4
3
2
1
A
1
2
3
4
5
6
7
8
9
10
11
12 Quantity
Curve A represents which type of cost curve?
(a). marginal cost
(b). average fixed cost
(c). average variable cost
(d). average total cost
19. A monopolist's profits with price discrimination will be
(a). lower than if the firm charged a single, profit-maximizing price
(b). the same as if the firm charged a single, profit-maximizing price.
(c). higher than if the firm charged just one price because the firm will capture more consumer
surplus.
(d). higher than if the firm charged a single price because the costs of selling the good will be
lower.
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20. Brian and Matt own the only two bicycle repair shops in town. Each must choose between a low price for
repair work and a high price. The annual economic profit from each strategy is indicated in the table. The
profits are shown as (Matt, Brian) in each cell.
Brian
Low Price
High Price
Low Price
(1500, 1500)
(5000, 200)
High Price
(200, 3000)
(4000, 4000)
Matt
Which of the following statements is correct?
(a). Matt's dominant strategy is to charge a low price.
(b). Brian's dominant strategy is to charge a high price.
(c). The dominant strategy for both Brian and Matt is to charge a low price.
(d). Matt's dominant strategy is to charge a high price.
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