Econ1101 Past Exam

THE UNIVERSITY OF NEW SOUTH WALES SCHOOL OF ECONOMICS SESSION 1, 2008 ECONllOl MICROECONOMICS I FINAL EXAMINATION TIME ALLOWED - 2HOURS

THIS PAPER IS WORTH 60% OF THE TOTAL SUBJECT MARK

This examination paper consists of two parts - Part A and Part B Part A consists of 20 multiple choice questions each worth one (1) mark. Answer all the questions in Part A on the answer sheet provided, using pencil only: (a) Print your student number, name and initials in the space provided and mark the appropriate boxes below your student number, name and initials. (b) For each question, mark the appropriate response (a), (b), (c), or (cl). There is only one correct response to each question in Part A.

Part B consists of four (4) essay-type questions, each worth TWENTY (20) marks. Answer only TWO (2) questions from Part B. ANSWER EACH PART B QUESTION IN A SEPARATE EXAMINATION BOOKLET Answers to questions in Part B must be written in ink. Pencil may be used in answers to Part B for drawing, sketching or graphical work only.

This question paper may be retained by the candidate

PART A

This section is worth 20 marks Mark your answer on Answer Sheet provided Question 1
If

Output Average Total Cost Total Fixed Cost Marginal Cost

= 400 units = $70 = $12000 = $90

then
(a) $20 (b) $40 (c) $50

Average Variable Cost equals:

(d) $160

Question 2
In an imperfectly competitive market, in which a firm has some market power: (a) The demand curve faced by a typical firm is perfectly elastic at the current market price (b) Marginal revenue is greater than average revenue at all levels of production. (c) The demand curve faced by the typical firm is significantly less elastic for price increases than for price decreases. (d) For the typical firm, price is greater than marginal cost at the profit-maximising output level.

Question 3
At the level of production at which short run average cost is minimized: (a) Marginal cost equals average cost. (b) Marginal