Introduction to Macroeconomics
ECON 201: Introduction to Macroeconomics Midterm Exam 1: Answer Packet October 10, 2011 NAME: _________________________________ Circle your TA’s name: Circle your section time: Agustin 9 a.m. Brian 3 p.m. Meysam
Directions: This test is in two parts, a multiple choice question part and a short-answer part. Use this answer packet to complete the exam. Calculators are permitted. Books, notes, reference materials, etc. are prohibited. Good luck! Part 1: Referring to the questions in the Multiple Choice Questions Packet, choose the one alternative that best completes the statement or answers the question. Each question is worth one point. There is no penalty to guessing, so be sure to answer all of them. Write your answers in the following table using capital letters. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Part 2: Solve the following five problems in the spaces provided. Show all your work! PROBLEM 1: 4 points: 2 points per blank Assume that demand and supply are linear. Use the following tables to determine the demand and supply equations. Price 14 8 Quantity Demanded 4 7
1. The demand equation is P = ______________________________. P = 22 - 2Qd Price 11 5 Quantity Supplied 8 0
2. The supply equation is P = ______________________________. P = (3/4)Qs + 5 PROBLEM 2: 2 points: 1 point per blank. Assume that demand is given by P = 33 – (3/8)Qd Assume that supply is given by P = 0.5Qs + 5 Complete the following statement. 1. The free-market competitive equilibrium is at a quantity of __________, and a price of __________. 32, 21 PROBLEM 3: 5 points: 1 point per blank. Demand for good A is given by PA = 10 + 0.5PB – 2QAd where PB is the price of good B, and QAd is the quantity of good A demanded. Supply for good A is horizontal, and is given by PA = 8. Complete the following statements. 1. Suppose that PB = 4. The demand equation for good A is therefore PA = ______________________________. The market equilibrium
Directions: This test is in two parts, a multiple choice question part and a short-answer part. Use this answer packet to complete the exam. Calculators are permitted. Books, notes, reference materials, etc. are prohibited. Good luck! Part 1: Referring to the questions in the Multiple Choice Questions Packet, choose the one alternative that best completes the statement or answers the question. Each question is worth one point. There is no penalty to guessing, so be sure to answer all of them. Write your answers in the following table using capital letters. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Part 2: Solve the following five problems in the spaces provided. Show all your work! PROBLEM 1: 4 points: 2 points per blank Assume that demand and supply are linear. Use the following tables to determine the demand and supply equations. Price 14 8 Quantity Demanded 4 7
1. The demand equation is P = ______________________________. P = 22 - 2Qd Price 11 5 Quantity Supplied 8 0
2. The supply equation is P = ______________________________. P = (3/4)Qs + 5 PROBLEM 2: 2 points: 1 point per blank. Assume that demand is given by P = 33 – (3/8)Qd Assume that supply is given by P = 0.5Qs + 5 Complete the following statement. 1. The free-market competitive equilibrium is at a quantity of __________, and a price of __________. 32, 21 PROBLEM 3: 5 points: 1 point per blank. Demand for good A is given by PA = 10 + 0.5PB – 2QAd where PB is the price of good B, and QAd is the quantity of good A demanded. Supply for good A is horizontal, and is given by PA = 8. Complete the following statements. 1. Suppose that PB = 4. The demand equation for good A is therefore PA = ______________________________. The market equilibrium