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1
=
The purpose of the practice exam is to =
help
you become famil=
iar
with the general format of the exam and some of the kinds of questions you <=
span
style=3D'position:absolute;top:24.5%;left:6.92%;width:90.07%;height:6.0%'>=
may be asked on the exam. You should go through the practice exam and if a ques=
tion
seems difficult re=
view
that area in your text and notes since it is a sign that you need to think about that chapter more. The actual exam
will include simi=
lar
types of questions, and cover the same chapters, but most of the questions will not =
be exactly the same. During the exam read the <=
/span>questions carefully and think carefully=
.
2
Practice Final Exam
Note there are 5 parts however the number of <=
span
style=3D'font-size:150%'>points for each part varies so you should allocat=
e =
more time to those parts worth more points.
<=
/span>
The first part is worth 30 points.
Since there are 15 questions this means each <=
span
style=3D'font-size:150%'>question is worth 2 points.
<=
span
style=3D'font-size:150%'>Also notice you are asked to briefly explain your answer.
3
=
1. What's the difference between <=
/span>microeconomics and macroeconomics?
4
Macro=
v.
Micro
•Macroeconomics is the study of how countries or regions or major sectors within =
an
economy choose to use their scarce resources given unlimited wants. It includes topics like: unemplo=
yment,
inflation, GDP,
fiscal policy, & monetary policy
<=
span
style=3D'color:red'>•Microeconomics=
is
the study of how individuals and firms
choose to use their scarce resources given unlimited wants It includes topics like: consumer decisions, firm costs, industry structure, & marke=
t intervention.
5
2. What is the distinctio=
n between positive and norm=
ative economics?
6
Posit=
ive v.
normative
<=
span
style=3D'font-size:88%;color:#000099'>•Positive =3D facts or
predictions based on theory or models
•
<=
span
style=3D'font-size:88%;color:#000099'>•Normative =3D represents a value judgement about what is desirabl=
e,
good, bad, or should be done, it implies
advocacy and cannot be proved or disproved.
7
3. What does elasticity of
supply tell
us?
8
E=
S=3D
% Change Q supplied=
% change P
Elasticity of supply (E<=
/span>s) indicates h=
ow
responsive the quantity supplied is to changes in =
the
price
![](3D"slide0242_image001.gif")
9
4. What's the difference
between a
change in supply and a change in the quantity supplied?
10
A
change in supply is a change in the entire supply schedule, a
shift of the curve due to a change in a
determinant of supply.
Such as due to a change in:
Resource
Prices, Technique of Production, Taxes & Subsidies,
Prices of Other Goods, Price =Expectations, or Number of Sellers
determinant of supply.
Such as due to a change in:
Prices of Other Goods, Price =
11
Change in Quantity Supplied
•=
;Following the law of supply a change=
in the quantity supplied can occur simply due to a price change by moving
along the supply curve.
•=
;Eg. As Price Falls the quantity =
supplied falls, all else equal
12
5. What are the fo=
ur
major industry structures?
=
=
13
5. What are the fo=
ur
major industry structures?
=
=
Perfect Competition
Monopolistic competition
Oligopoly
Monopoly
14
6. Which industry
structure is most common and why?
=
=
15
6. Which industry
structure is most common and why?
=
=
Monopolistic compet=
ition
is the most common industry structure because there is easy entry but firms are always tr=
ying
to differentiate their products and services.
16
7. Describe unionism grea=
test period of growth ?
17
7. Describe unionism grea=
test
period of growth?
Union membership in the U.S. grew fastest in the 1930s and 1940s. In the 1930s the = great depression made people more open to modifying capitalism= and laws such as the Norris LaGuardia and NLRA both = made it easier and safer for people to unionize.
Then in the 1940s WWII sharply raised the demand for labor and so raised the power of labor unions.
Union membership in the U.S. grew fastest in the 1930s and 1940s. In the 1930s the = great depression made people more open to modifying capitalism= and laws such as the Norris LaGuardia and NLRA both = made it easier and safer for people to unionize.
Then in the 1940s WWII sharply raised the demand for labor and so raised the power of labor unions.
18
8. What’s the diffe=
rence
between a
progressive and a regressive tax?
19
<=
span
style=3D'mso-bidi-font-family:"Times New Roman";font-size:82%'>8. WhatR=
17;s
the difference between a progressive and a regressive tax?
A progressive tax is an increasing = percentage of income as income increases.
A regressive tax is a decreasing = p= ercentage of income as income increases.
<= /div>
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A progressive tax is an increasing = percentage of income as income increases.
A regressive tax is a decreasing = p= ercentage of income as income increases.
<= /div>
20
9. What’s the diffe=
rence
between a
horizontal merger and a vertical merger?
21
9. WhatR=
17;s
the difference between a horizontal merger and a vertical merger?<=
/span>
![](3D"slide0316_image002.gif")
A horizontal merger is a merger
between firms that make the same type of product. They are =
competitors
and so they may be attempting to gain market power and be block=
ed
by the Justice Dept.
A vertical merger is a merger between firms that contribute to different parts of the overall production process for a good.
A vertical merger is a merger between firms that contribute to different parts of the overall production process for a good.
22
10. Give an exampl=
e of
an externality.
23
=
10. =
Give an example of an externality.
Reduced probability of other people getting sick when someone chooses to get a vaccination is an example o= f a positive externality. Increased health problems because of pollution would be an example = <= span style=3D'mso-bidi-font-family:"Times New Roman";font-size:91%;color:red; mso-color-index:6'>of a negative externality.
(Since an externality is spillover benef= it or cost to a third party not directly involved in a transaction, not a buyer or seller in the market.)
Reduced probability of other people getting sick when someone chooses to get a vaccination is an example o= f a positive externality. Increased health problems because of pollution would be an example = <= span style=3D'mso-bidi-font-family:"Times New Roman";font-size:91%;color:red; mso-color-index:6'>of a negative externality.
(Since an externality is spillover benef= it or cost to a third party not directly involved in a transaction, not a buyer or seller in the market.)
24
11. What percentage of ch=
ildren
in th=
e U.S.
live below the poverty line?
25
11. What percentage of ch=
ildren
in the U.S.
live below the poverty line?
About 18% of children in the U.S. live below the poverty line.
About 18% of children in the U.S. live below the poverty line.
26
12. What is Medicare and =
why was it created?
27
<=
span
style=3D'mso-bidi-font-family:"Times New Roman"'>
Medicare is a government health insurance program for the elderly. It = was created bec= ause (due in part to adverse selection) in the absence of = government intervention health insurance for the elderly would be = undersupplied.<= /span>
Medicare is a government health insurance program for the elderly. It = was created bec= ause (due in part to adverse selection) in the absence of = government intervention health insurance for the elderly would be = undersupplied.<= /span>
28
13. Why might it be desir=
able
to allow
monopolies?
29
=
13. Why mig=
ht it
be desirable to allow monopolies?
Some people believe allowing temporary monopolies in the case of patents and copyrights helps give an incentive for = creativity and = inventiveness. Also if= it’s a natural monopoly it=
will be more efficient (lower ATC), although you =
may want to regulate it.
Some people believe allowing temporary monopolies in the case of patents and copyrights helps give an incentive for = creativity and = inventiveness. Also if= it’s a natural monopoly it
30
14. What’s the diff=
erence
betwe=
en a
private good and a public
good.
31
<=
span
style=3D'mso-bidi-font-family:"Times New Roman";font-size:82%'>14. What=
217;s
the difference between a private good and a public good.
For private goods consumption by different=
p=
eople
reduces the amount available and you can be kept from consuming the =
good
if you do not pay for it.
Public goods are non-rival and non-excludable <= span style=3D'mso-bidi-font-family:"Times New Roman";font-size:82%;color:#00009= 9'>in consumption, each unit benefits all the consumers.
For private goods consumption by different
Public goods are non-rival and non-excludable <= span style=3D'mso-bidi-font-family:"Times New Roman";font-size:82%;color:#00009= 9'>in consumption, each unit benefits all the consumers.
32
15. What determines the d=
emand for a resource such as la=
bor?
33
=
15. What
determines the demand for a resource such as labor?
The demand for a resource depends on = the value o= f what it can produce, it’s Marginal Revenue Product (MRP) compared to= the MRP of other resources.
(MRP =3DMR x MP)
The demand for a resource depends on = the value o= f what it can produce, it’s Marginal Revenue Product (MRP) compared to= the MRP of other resources.
(MRP =3DMR x MP)
34
The second part is worth 15 points.
Since there are 5 questions this means each <=
span
style=3D'font-size:150%'>question is worth 3 points.
You should label your graphs clearly.
Part II
35
![](3D"slide0328_image003.gif")
1. The effe=
ct
of an increase in incomes on the market for macadamia nuts. <=
/span>
![](3D"slide0328_image004.gif")
P
Q of macadamia nuts
D
S
P1<=
/span>
Q1<=
/span>
36
![](3D"slide0329_image005.gif")
![](3D"slide0329_image006.gif")
P
Q macadamia nuts
D1<=
/span>
S
P1<=
/span>
Q1<=
/span>
![](3D"slide0329_image007.gif")
D2<=
/span>
P2<=
/span>
Q2<=
/span>
=
1. The effe=
ct
of an increase in incomes on the market for macadamia nuts=
. <=
/span>
37
![](3D"slide0330_image008.gif")
2. The effect of a decrease in the cost=
of =
mozzarella
cheese on the pizza market.
![](3D"slide0330_image009.gif")
P
Q
Market for pizza
D
S
P1<=
/span>
Q1<=
/span>
38
![](3D"slide0331_image010.gif")
2. The effect of a decrease in the cost=
of mozzarella
cheese on the pizza market.
![](3D"slide0331_image011.gif")
P
Q
Market for pizzas
D
S
P1<=
/span>
Q1<=
/span>
![](3D"slide0331_image012.gif")
S2
Q2
P2
39
![](3D"slide0332_image013.gif")
3=
. The
effect of a bumper crop of peanuts on the market for jelly.
![](3D"slide0332_image014.gif")
inte=
rest
Q of financial resources
D
S
i1<=
/span>
Q1<=
/span>
40
![](3D"slide0333_image015.gif")
![](3D"slide0333_image016.gif")
Q
of jelly
=
;
D1<=
/span>
S
P1<=
/span>
Q1<=
/span>
![](3D"slide0333_image017.gif")
D2<=
/span>
P2<=
/span>
Q2<=
/span>
Pric=
e
3=
. The
effect of a bumper crop of peanuts on the market for jelly.
Due
to a bumper crop of peanuts, peanut butter will be cheaper & people will
buy more peanut butter & demand more of the complement jelly.
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41
![](3D"slide0337_image018.gif")
4. The effect of an increase in the pri=
ce
of ice cream on the market for hot fudge.
![](3D"slide0337_image019.gif")
![](3D"slide0337_image020.gif")
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Pric=
e
Quantity
Market for a good whose complement h=
as
increased in price
D
S
P1<=
/span>
Q1<=
/span>
42
![](3D"slide0338_image021.gif")
4. The effect of an increase in the pri=
ce
of ice cream on the market for hot fudge.
![](3D"slide0338_image022.gif")
![](3D"slide0338_image023.gif")
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P
Q of hot fudge
Market for a good whose complement h=
as
increased in price
D1<=
/span>
S
P1<=
/span>
Q1<=
/span>
D2<=
/span>
P2<=
/span>
Q2<=
/span>
43
![](3D"slide0339_image024.gif")
=
5. The effe=
ct
of a recession on the market for do-it-yourself books.
![](3D"slide0339_image025.gif")
P
Q
Market for an inferior good
D
S
P1<=
/span>
Q1<=
/span>
44
5. This is the effect of a d=
ecrease <=
/span>in <=
span
style=3D'position:absolute;top:12.75%;left:4.3%;width:91.57%;height:7.0%'>=
incomes if the goo=
d is
an inferior good.
![](3D"slide0340_image026.gif")
![](3D"slide0340_image027.gif")
P
Q
Market for inferior good
D1<=
/span>
S
P1<=
/span>
Q1<=
/span>
![](3D"slide0340_image028.gif")
D2
P2
Q2
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45
The third part is worth 25 points.
Since there are 5 questions this means each <=
span
style=3D'font-size:150%'>question is worth 5 points.
You should label your graphs clearly.
Part III
46
1. D=
epict
an oligopolistic firm using the kinked demand model of
oligopoly. Why is there a ki=
nk involved?
47
![](3D"slide0342_image029.gif")
![](3D"slide0342_image030.gif")
D
MR
Quantity
![](3D"slide0342_image031.gif")
Profit
maximization
MR >=3D MC occurs
at the kink
![](3D"slide0342_image032.gif")
KINKED DEMAND
<=
/span>
![3D"Text](3D"slide0342_image033.gif")
Price
![](3D"slide0342_image034.gif")
![](3D"slide0342_image035.gif")
![](3D"slide0342_image036.gif")
MC1
PO&=
#13;
QO
48
There is a =
kink
at Po because if the =
oligopolist
charges more than Po they =
will lose m=
ost of
their customers to the other oligopolists who will maintain thei=
r =
price at P<=
/span>o . However if the oligopolist =
charges les=
s than
Po they will n=
ot
gain very many sales because the other =
oligopolist=
s will
follow a price cut.
49
2. Depict a natural
monopoly. Without
regulation what level of output would they produce? In what sense is there a
deadweight loss to society?
50
UNREGULATED NATURAL MONOPOLY
![](3D"slide0347_image037.gif")
![](3D"slide0347_image038.gif")
![](3D"slide0347_image039.gif")
![](3D"slide0347_image040.gif")
Q
![](3D"slide0347_image041.gif")
D
MR
MC
ATC
P
<=
![if !ppt]>![3D"Text](3D"slide0347_image042.gif")
![](3D"dsld0347_imag=)
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![](3D"slide0347_image046.gif")
![](3D"slide0347_image047.gif")
![](3D"slide0347_image048.gif")
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Practice Final ECON2510
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Practice Final ECON2510
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solution
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Practice Final ECON2510
![](3D"slide0397_image089.gif")
![3D"Text](3D"slide0397_image090.gif")
=
Price and Costs
Mono=
poly
Price
MR
=3D MC
Qm
Pm
51
=
There is a =
dead
weight loss to society because the additional cost to produce =
more units =
(MC)
is below the additional social benefit (D), but without =
intervention
these units will not be produced.
52
3. Depict a
monopsony. Be sure to indicate
how much they will buy and how much they will pay. In what sense is
there a deadweight loss to society?
53
Wage Rate (dollars)
MRP
S
Wm
<=
b>Quantity
of Labor
MRC
Wc<=
/b>
Qm
Qc<=
/b>
The
competitive
result in a
higher
MONOPSONISTI=
C
LABOR
MARKET
DWL
54
=
There is a =
dead
weight loss to society because the additional social cost of =
more units =
(S) is
below the additional benefit (MRP), but without intervention =
these units=
will
not be purchased because the monopsonist is concerned about =
bidding up =
the
price and thus considers the marginal resource cost to him.
55
4. Use a diagram and clea=
rly
label the axes
and curves to explain why economists advocate taxing production of a good which
produces a negative
externality.
56
P
Q
Production =
which
causes pollution
D
Spillover
Costs
(MEC)
SMC
S (PMC)
Q*
Q1
DWL
P*
Q1
57
Taxing production of a go=
od which produces a negative=
externality can reduce th=
e DWL to society due to
overproduction.
Ideal= ly a tax =3D marginal externality cost (MEC) would reduce production to the optimal level.
Ideal= ly a tax =3D marginal externality cost (MEC) would reduce production to the optimal level.
58
5. Draw a L=
orenz
curve for a society in which the lowest 20% of families has 1% of incom=
e, the
second 20% has 8%, the third 20% has 16%, the fourth has 25% and the=
fifth
has 50%. Assuming that taxes and transfers make the income distributio=
n more
even, how would that tend to change your graph?
59
=
;
20 =
;
40 =
;
60 =
;
80 =
;
100
<=
b>100
<=
b>
<=
b>
<=
b>50
<=
b>
<=
b>25
<=
b>
<=
b>
<=
b>9
<=
b>1
<=
b>
0
Percent of Families
=
Percent of Income<=
/div>
![](3D"slide0394_image070.gif")
![](3D"slide0394_image071.gif")
![](3D"slide0394_image072.gif")
![](3D"slide0394_image073.gif")
![](3D"slide0394_image074.gif")
![](3D"slide0394_image075.gif")
![](3D"slide0394_image076.gif")
![](3D"slide0394_image077.gif")
![](3D"slide0394_image078.gif")
![](3D"slide0394_image079.gif")
Perfect Equality
Lorenz Curve=
3;
(actual distribution)
=
THE
LORENZ CURVE
60
=
;
20 =
;
40 =
;
60 =
;
80 =
;
100
<=
b>100
<=
b>
<=
b>
<=
b>50
<=
b>
<=
b>25
<=
b>
<=
b>
<=
b>9
<=
b>1
<=
b>
0
Percent of Families
=
Percent of Income<=
/div>
![](3D"slide0398_image082.gif")
![](3D"slide0398_image083.gif")
![](3D"slide0398_image084.gif")
![](3D"slide0398_image085.gif")
![](3D"slide0398_image086.gif")
![](3D"slide0398_image087.gif")
![](3D"slide0398_image088.gif")
Perfect Equality
Lorenz Curve=
3;
(actual distribution)
=
THE
LORENZ CURVE
Lorenz
curve
after=
taxes
and
transfers
61
=
;
20 =
;
40 =
;
60 =
;
80 =
;
100
100
=
=
=
80
=
=
=
60
=
=
=
40
=
=
=
20
=
=
0
Percent of Families
=
Percent of Income<=
/div>
![](3D"slide0397_image091.gif")
![](3D"slide0397_image092.gif")
![](3D"slide0397_image093.gif")
![](3D"slide0397_image094.gif")
![](3D"slide0397_image095.gif")
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Practice Final ECON2510
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Practice Final ECON2510
6. Which of the foll=
owing
would tend to be associated with a strong demand for a =
resource?
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Practice Final ECON2510
6. Which of the foll=
owing
would tend to be associated with a strong demand for a =
resource?
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Practice Final ECON2510
9. Which of the foll=
owing
statements is true?
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Practice Final ECON2510
9. Which of the foll=
owing
statements is true?
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Practice Final ECON2510
Perfect Equality
Complete
Inequality<=
/div>
Lorenz Curve=
3;
(actual distribution)
=
Area
between
=
the
lines shows
=
the
degree of
=
income
inequality
=
THE
LORENZ CURVE
Lorenz
curve
after=
taxes
and
transfers
62
The fourth part is worth 20 points.
Since there are 10 questions this means each <=
span
style=3D'font-size:150%'>question is worth 2 points.
You should choose the best answer.
You can just circle your choice on the exam if <=
span
style=3D'font-size:150%'>you wish.
Part IV
63
1. The law of diminishing marginal utili=
ty
states that:
A) Additional units of consumption yield less ext= ra satisfacti= on.
B) Additional units of consumption result in decl= ines in total satisfaction.
C) Additional units of consumption yield no additional satisfaction.
D) Consumers stop purchasing additional units of = a good when diminishing marginal utility begins.
E) The level of satisfaction produced by a good at the margin is independent of the level of consumption. =
A) Additional units of consumption yield less ext= ra satisfacti= on.
B) Additional units of consumption result in decl= ines in total satisfaction.
C) Additional units of consumption yield no additional satisfaction.
D) Consumers stop purchasing additional units of = a good when diminishing marginal utility begins.
E) The level of satisfaction produced by a good at the margin is independent of the level of consumption. =
64
1. The law of diminishing marginal utili=
ty
states that:
A) Additional units of consumption yield less extra satisfaction.
B) Additional units of consumption result in decl= ines in total satisfaction.
C) Additional units of consumption yield no additional satisfaction.
D) Consumers stop purchasing additional units of = a good when diminishing marginal utility begins.
E) The level of satisfaction produced by a good at the margin is independent of the level of consumption. =
A) Additional units of consumption yield less extra satisfaction.
B) Additional units of consumption result in decl= ines in total satisfaction.
C) Additional units of consumption yield no additional satisfaction.
D) Consumers stop purchasing additional units of = a good when diminishing marginal utility begins.
E) The level of satisfaction produced by a good at the margin is independent of the level of consumption. =
65
2. The substitution effect of a price ch=
ange
is brought about by:
A) A change in nominal income of the consumer
B) A change in real income caused by a price change
C) A shift in the demand curve caused by a price = increase o= f the good
D) A change in the relative prices due to a chang= e in the price of a good
E) Inflation
A) A change in nominal income of the consumer
B) A change in real income caused by a price change
C) A shift in the demand curve caused by a price = increase o= f the good
D) A change in the relative prices due to a chang= e in the price of a good
E) Inflation
66
2. The substitution effect of a price ch=
ange
is brought about by:
A) A change in nominal income of the consumer
B) A change in real income caused by a price change
C) A shift in the demand curve caused by a price = increase o= f the good
D) A change in the relative prices due to a change in the price of a good
E) Inflation
A) A change in nominal income of the consumer
B) A change in real income caused by a price change
C) A shift in the demand curve caused by a price = increase o= f the good
D) A change in the relative prices due to a change in the price of a good
E) Inflation
67
3. A government-imposed price ceiling on
gasoline would tend to:
A) Create a shortage of gasoline
B) Create a surplus of gasoline
C) Encourage more gasoline stations to open
D) Encourage more exploration for oil
E) All of= the above
A) Create a shortage of gasoline
B) Create a surplus of gasoline
C) Encourage more gasoline stations to open
D) Encourage more exploration for oil
E) All of= the above
68
3. A government-imposed price ceiling on
gasoline would tend to:
A) Create a shortage of gasoline
B) Create a surplus of gasoline
C) Encourage more gasoline stations to open
D) Encourage more exploration for oil
E) All of the above
A) Create a shortage of gasoline
C) Encourage more gasoline stations to open
D) Encourage more exploration for oil
E) All of the above
69
4. If price elasticity were 2.4 and the
price of the good increased by 4 percent, we would expect a change in =
quantity s=
old
of:
A) 9.6%
B) -9.6%
C) 1%
D) Cannot tell from the above information.
E) Need to know income elasticity =
A) 9.6%
B) -9.6%
C) 1%
D) Cannot tell from the above information.
E) Need to know income elasticity =
70
4. If price elasticity were 2.4 and the
price of the good increased by 4 percent, we would expect a change in =
quantity s=
old
of:
A) 9.6%
B) -9.6%
C) 1%
D) Cannot tell from the above information.
E) Need to know income elasticity =
A) 9.6%
B) -9.6%
C) 1%
D) Cannot tell from the above information.
E) Need to know income elasticity =
71
5. Which of the following terms is best
associated with oligopoly markets?
A) Entry
B) Dominance
C) Differentiation
D) Independence
E) None of the above
A) Entry
B) Dominance
C) Differentiation
D) Independence
E) None of the above
72
5. Which of the following terms is best
associated with oligopoly markets?
A) Entry
B) Dominance
C) Differentiation
D) Independence
E) None of the above
A) Entry
B) Dominance
C) Differentiation
D) Independence
E) None of the above
73
A)
Relatively low marginal product.
B)
Relatively low market price of the final good.
C)
Relatively strong marginal product of the resource.
D)
Relatively elastic demand for the good.
E)
Relatively elastic supply of resource
74
A)
Relatively low marginal product.
B)
Relatively low market price of the final good.
C)
Relatively strong marginal product of the resource.
D)
Relatively elastic demand for the good.
E)
Relatively elastic supply of resource
75
<=
span
style=3D'font-size:91%'>7. If the price elasticity of demand for a =
product is 2.5, then a price cut from $2.00 =
to $1.80 will:
A) in=
crease
the quantity demanded by about 2.5%.
B) dec=
rease
the quantity demanded by about 2.5%.
C) de=
crease
the quantity demanded by about 25%.
D) in=
crease
the quantity demanded by about 25%.
E) in=
crease
the quantity demanded by about 250%.
76
<=
span
style=3D'font-size:91%'>7. If the price elasticity of demand for a =
product is 2.5, then a price cut from $2.00 =
to $1.80 will:
A) in=
crease
the quantity demanded by about 2.5%.
B) dec=
rease
the quantity demanded by about 2.5%.
C) de=
crease
the quantity demanded by about 25%.
D)
increase the quantity demanded by about 25%.
E) in=
crease
the quantity demanded by about 250%.
77
8. A tight monetary policy in the United
States is likely to cause:
A) A depreciation of the dollar
B) An appreciation of the dollar
C) An increase in exports
D) No change in the value of the dollar= on foreign exchange markets
E) Inflation
A) A depreciation of the dollar
B) An appreciation of the dollar
C) An increase in exports
D) No change in the value of the dollar= on foreign exchange markets
E) Inflation
78
8. A tight monetary policy in the United
States is likely to cause:
A) A depreciation of the dollar
B) An appreciation of the dollar
C) An increase in exports
D) No change in the value of the dollar= on foreign exchange markets
E) Inflation
A) A depreciation of the dollar
B) An appreciation of the dollar
C) An increase in exports
D) No change in the value of the dollar= on foreign exchange markets
E) Inflation
79
A) Muhammad Yunus fo=
unded
the Grameen Bank.
B)
The Grameen Bank makes micro loans to extremely poor people with business ideas.
C)
Muhammad Yunus is an economist who won the Nobel Peace Prize in 2006.
D)
Grameen Bank loans have a payback rate of about 98% even though the borrowers are often women who had incomes below $1 per day.
E) All=
of
the above.
80
A) Muhammad Yunus fo=
unded
the Grameen Bank.
B)
The Grameen Bank makes micro loans to extremely poor people with business ideas.
C)
Muhammad Yunus is an economist who won the Nobel Peace Prize in 2006.
D)
Grameen Bank loans have a payback rate of about 98% even though the borrowers are often women who had incomes below $1 per day.
E)
All of the above.
81
10. The Law of Demand:
A) Is a generalization about the relationship between price and quantity demanded
B) Is a rigid relationship between price and quantity demanded
C) Is generally valid for periods of le= ss than one year
D) Is shown as a positive relationship between pr= ice and quanti= ty demanded
E) Is shown as a negative relationship between price and quantity demanded
A) Is a generalization about the relationship between price and quantity demanded
B) Is a rigid relationship between price and quantity demanded
C) Is generally valid for periods of le= ss than one year
D) Is shown as a positive relationship between pr= ice and quanti= ty demanded
E) Is shown as a negative relationship between price and quantity demanded
82
10. The Law of Demand:
A) Is a generalization about the relationship between price and quantity demanded
B) Is a rigid relationship between price and quantity demanded
C) Is generally valid for periods of le= ss than one year
D) Is shown as a positive relationship between pr= ice and quanti= ty demanded
E) Is shown as a negative relationship between price and quantity demanded
A) Is a generalization about the relationship between price and quantity demanded
B) Is a rigid relationship between price and quantity demanded
C) Is generally valid for periods of le= ss than one year
D) Is shown as a positive relationship between pr= ice and quanti= ty demanded
E) Is shown as a negative relationship between price and quantity demanded
83
The fifth part is worth 10 points.
In the following slides I’ve given a brief
outline of some ideas to
consider.
You sho=
uld
choose the essay for which you can give
the most thorough response given what you =
have learned and explain
clearly what you think.&=
#13;
Part V
84
&=
#13;
=
1.
What are the four major industry structures and what are the
main distinguishing characteristics of each?
<= br> <= br>
<= br> <= br>
85