MPE_AMI2: test_6.1.2012
Jméno a příjmení – pište do okénka UČO Číslo zadání
20
1 A competitive firm produces output using three
fixed factors and one variable factor. The firm's
short-run production function is q = 305x − 2x2
,
where x is the amount of variable factor used. The
price of the output is $2 per unit and the price of
the variable factor is $10 per unit. In the short run,
how many units of x should the firm use?
A 37
B 150
C 21
D 75
E None of the above.
2 Ike's utility function is U(x, y) = 25xy. He has 12
units of good x and 8 units of good y. Ben's utility
function for the same two goods is U(x, y) = 4x+4y.
Ben has 9 units of x and 13 units of y.
A Ike prefers Ben's bundle to his own bundle, but Ben
prefers his own bundle to Ike's.
B Ben prefers Ike's bundle to his own, but Ike prefers
his own bundle to Ben's.
C Each prefers the other's bundle to his own.
D Neither prefers the other's bundle to his own.
E Since they have different preferences, there is
not enough information to determine who envies
whom.
3 A monopoly has the demand curve q = 10, 000 −
100p. Its total cost function is c(q) = 1, 000 + 10q.
The government plans to tax the monopoly's profits
at a rate of 50%. If it does so, the monopoly will
A increase its price by 50%.
B increase its price by more than 50%.
C recover some but not all of the tax it pays by increasing
its price.
D not change its price or the quantity it sells.
E None of the above.
4 If there are only two goods, if more of good 1 is
always preferred to less, and if less of good 2 is
always preferred to more, then indifference curves
A slope downward.
B slope upward.
C may cross.
D could take the form of ellipses.
E None of the above.
5 Edmund must pay $6 each for punk rock video cassettes,
V . If Edmund is paid $24 per sack for accepting
garbage, G, and if his relatives send him an
allowance of $96, then his budget line is described
by the equation
A 6V = 24G.
B 6V + 24G = 96.
C 6V = 96 − G.
D 6V − 24G = 96.
E None of the above.
6 Suppose that in Enigma, Ohio, klutzes have a productivity
of $1,000 and kandos have a productivity
of $5,000 per month. You can't tell klutzes from
kandos by looking at them or asking them, and it
is too expensive to monitor individual productivity.
Kandos, however, have more patience than klutzes.
Listening to an hour of dull lectures is as bad as losing
$250 for a klutz and $100 for a kando. There
will be a separating equilibrium in which anybody
who attends a course of H hours of lectures is paid
$5,000 per month and anybody who does not is paid
$1,000 per month
A if 16 < H < 80.
B if 16 < H < 40.
C only in the limit as H approaches infinity.
D for all positive values of H.
E if 14 < H < 35.
7 Harley's current wealth is $600, but there is a .25
probability that he will lose $100. Harley is risk neutral.
He has an opportunity to buy insurance that
would restore his $100 if he lost it.
A Harley would be willing to pay a bit more than $25
for this insurance.
B Harley would be willing to pay up to $25 for this
insurance.
C Since Harley is risk neutral, he wouldn't be willing
to pay anything for this insurance.
D Since Harley's utility function is not specified, we
can't tell how much he would be willing to pay for
this insurance.
E Harley would not be willing to pay more than
$16.66 for this insurance.
MPE_AMI2: test_6.1.2012 Zadání č. 20
8 A firm has the long-run cost function C(q) = 3q2
+
27. In the long run, it will supply a positive amount
of output, so long as the price is greater than
A $36.
B $44.
C $9.
D $18.
E $23.
9 The production function is given by f(x) = 4x1/2
. If
the price of the commodity produced is $80 per unit
and the cost of the input is $40 per unit, how much
profits will the firm make if it maximizes profits?
A $318
B $1,284
C $640
D $625
E $323
10 An industry has two firms - a Stackelberg leader
and a follower. The price of the industry output is
given by P = 84 − Q, where Q is the total output
of the two firms. The follower has a marginal cost
of $0. The leader has a marginal cost of $21. How
much should the leader produce in order to maximize
profits?
A 21
B 24
C 42
D 19
E None of the above.
11 Miss Muffet insists on consuming 2 units of whey
per 1 unit of curds. If the price of curds is $5 and
the price of whey is $6, then if Miss Muffet's income
is m, her demand for curds will be
A 5c + 6w = m.
B 6m/5.
C 5m.
D m/5.
E m/17.
12 Charlie has a utility function U(xA, xB) = xAxB,
the price of apples is $1, and the price of bananas
is $2. If Charlie's income were $200, how many
units of bananas would he consume if he chose the
bundle that maximized his utility subject to his budget
constraint?
A 25
B 50
C 10
D 100
E 150
13 In Gas Pump, South Dakota, every Buick owner's
demand for gasoline is 20 − 5p for p less than or
equal to 4 and 0 for p > 4. Every Dodge owner's
demand is 15 − 3p for p less than or equal to 5 and
0 for p > 5. Suppose that Gas Pump has 100 Buick
owners and 100 Dodge owners. If the price of gasoline
is $4,50, what is the total amount of gasoline
demanded in Gas Pump?
A 300 gallons
B 75 gallons
C 225 gallons
D 150 gallons
E none of the above.
14 The inverse demand function for grapes is described
by the equation p = 518 − 5q, where p is the
price in dollars per crate and q is the number of
crates of grapes demanded per week. When p = $38
per crate, what is the price elasticity of demand for
grapes?
A -190/96
B -5/518
C -5/96
D -96/38
E -38/480
15 Bella's budget line for x and y depends on all of the
following except
A the amount of money she has to spend on x and y.
B the price of x.
C her preferences between x and y.
D the price of y.
E None of the above.
16 If a firm moves from one point on a production
isoquant to another point on the same isoquant,
which of the following will certainly not happen?
A A change in the level of output
B A change in the ratio in which the inputs are com-
bined
C A change in the marginal products of the inputs
D A change in the rate of technical substitution
E A change in profitability
17 Goods 1 and 2 are perfect complements and a consumer
always consumes them in the ratio of 2 units
of good 2 to 1 unit of good 1. If a consumer has an
income of $300 and if the price of good 2 changes
from $5 to $6, while the price of good 1 stays at $1,
then the income effect of the price change
A is 6 times as strong as the substitution effect.
B does not change the demand for good 1.
C accounts for the entire change in demand.
D is exactly twice as strong as the substitution effect.
E is 5 times as strong as the substitution effect.
MPE_AMI2: test_6.1.2012 Zadání č. 20
18 The following relationship must hold between the
average total cost (ATC) curve and the marginal
cost curve (MC):
A If MC is rising, ATC must be rising.
B If MC is rising, ATC must be greater than MC.
C If MC is rising, ATC must be less than MC.
D If ATC is rising, MC must be greater than ATC.
E If ATC is rising, MC must be less than ATC.
19 An industry has 100 firms. These firms have identical
production functions. In the short run, each
firm has fixed costs of $200. There are two variable
factors in the short run and output is given by
y = (min{x1, 4x2})1/2
. The cost of factor 1 is $5 per
unit and the cost of factor 2 is $5 per unit. In the
short run, the industry supply curve is given by
A Q = 8p.
B Q = 10p.
C Q = 580p1/2
.
D the part of the line Q = 50(min{5, 20}) for which
pQ > 200/Q.
E None of the above.
20 According to the first theorem of welfare econo-
mics:
A every competitive equilibrium is fair.
B if the economy is in a competitive equilibrium, there
is no way to make anyone better off.
C a competitive equilibrium always exists.
D at a Pareto optimum, all consumers must be equally
wealthy.
E None of the above.
21 A monopolist has decreasing average costs as output
increases. If the monopolist sets price equal to
average cost, it will
A produce too much output from the standpoint of ef-
ficiency.
B lose money.
C produce too little output from the standpoint of ef-
ficiency.
D maximize its profits.
E face excess demand.
22 An orange grower has discovered a process for producing
oranges that requires two inputs. The production
function is Q = min{2x1, x2}, where x1 and
x2 are the amounts of inputs 1 and 2 that he uses.
The prices of these two inputs are w1 = $5 and
w2 = $10, respectively. The minimum cost of producing
160 units is therefore
A $2,000.
B $2,400.
C $800.
D $8,000.
E $1,600.