Professor M Rush ECO 2023 SUMMER B 2013 FINAL EXAM This test is governed by UF s academic honesty code It is intended to have 34 multiple choice questions Please check to be sure your copy has all 34 Choose the best answer for each question The next is important Unless you are specifically told otherwise on this test do not assume that demand or supply is either perfectly elastic or perfectly inelastic On the bubble sheet please enter 1 Your name and initials 2 Your UF ID number 3 Form code A 4 Sign your name on the bubble sheet TURN OFF ALL CELL PHONES AND OTHER COMMUNICATION DEVICES Check that the form code and UF ID number you bubbled in are correct now Also check to be sure your name is correct do it now I investigated the rumor that the ability to correctly record these had been mastered by a few students at FSU This rumor turned out to be false But the rumor that an accounting major and a journalism major did successfully record these on a test is true These students have since been bronzed and are on display outside their respective colleges to serve as an inspiration for all other accounting and journalism students CHECK YOUR FORM CODE AND UF ID NUMBER IF YOU GET EITHER OF THESE WRONG YOUR TEST MIGHT NOT BE GRADED AND IF IT IS GRADED YOU WILL LOSE 2 QUESTIONS I have become increasingly concerned that some students are at a real disadvantage because they are unwilling to ask questions during the exam while others ask a lot of questions Hence to level the playing field I have decided to eliminate all questions during the test I don t like this policy but it seems the fairest policy Do not ask questions of me or the TA s in the interest of fairness I have instructed them not to answer any questions during the exam You will have one hour 60 minutes to complete the exam and bubble in all your answers When the TAs say that time is up you must hand in your exam We will not give extra time to finish bubbling in the answers so be sure you are done when the 60 minutes are up Of course you may hand in your test at any time before the 60 minutes are up E C O 2 0 2 3 F I N A L E X A M S U M M E R B 2 0 1 3 An answer key will be posted on the class web page later this The test scores AND GRADES will be on class web page probably by evening at about 9 30 Monday Once you see the answer key you might have a question about why one answer is right and another is wrong For these questions email me at mark rush warrington ufl edu Do NOT email the grader about these questions After the scores are posted if you think your posted score is incorrect then email the grader at eco2023 grader warrington ufl edu If you email me about your test score I will not forward the email nor respond to you you MUST email the grader You have one week after the curved score is posted to request a grade check After a week the score will not be changed If the web reports what you bubbled in for each question and you ask the grader to check an answer because you believe you bubbled in something other than what is reported and the reported answer on the web is correct you will lose 1 additional question 2 E C O 2 0 2 3 F I N A L E X A M S U M M E R B 2 0 1 3 1 Suppose that Coke and Pepsi two soft drink manufacturers agree to charge the same prices for their soft drinks This practice would A B C D E always be legal under the antitrust laws be legal if the Herfindahl Hirschman index for the soft drink market is less than 1 000 be legal as long as the firms had a cost justification for setting prices be legal if otherwise Pepsi would go bankrupt always be illegal under the antitrust laws 2 If a Lorenz curve for income moves leftward and becomes closer to the line of equality then 3 The price of memory chips used to produce computers falls As a result the equilibrium price of a computer and the equilibrium quantity the population is growing income is growing income is being more equally distributed income is being more unequally distributed A B C D A B C D rises increases rises decreases falls increases falls decreases the long run i Perfect competition ii Monopolistic competition iii Monopoly A B C D E i only ii only iii only i and ii i ii and iii 4 A firm in which of the following market structures can make an economic profit in 5 The farther a Lorenz curve is from the 45 line of equality the larger is the nation s income smaller is the nation s income A B C more equally distributed is the nation s income D less equally distributed is the nation s income 6 The tragedy of the commons is the absence of incentives to A B C D use commonly owned resources prevent the overuse of commonly owned resources use privately owned resources have commonly owned resources 3 E C O 2 0 2 3 F I N A L E X A M S U M M E R B 2 0 1 3 7 The price of jet fuel rises As a result the equilibrium price of airline travel and the equilibrium quantity rises increases rises decreases falls increases falls decreases A B C D A B C D 8 There are no barriers to entry in markets only perfectly competitive only monopolistically competitive only monopoly perfectly competitive or monopolistically competitive 9 When 1 000 tacos are produced the marginal social benefit is of the 1 000th taco is 50 and the marginal social cost of the 1 000th taco is 60 To produce the efficient quantity of tacos A more tacos should be produced fewer tacos should be produced B C there should be no change in the amount of tacos produced D more information on production costs is needed to determine the efficient level of tacos 10 A firm s total cost is 250 its average variable cost is 10 and its output is 10 units Its average fixed cost is less than or equal to 10 00 between 10 01 and 20 00 between 20 01 and 40 00 A B C D more than 40 01 11 Which of the following is true regarding the long run for a firm in monopolistic competition The firms can make an economic profit because of product differentiation A B Marginal cost equals average total cost C Output is produced at minimum average total cost D E None of the above answers are true Price equals average total cost …
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