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  • Micro Revision 1 Solved

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    David
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    Solving problems in the field of economics !

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    Solving problems in the field of economics !

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    © All Rights Reserved
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    Segnala contenuti inappropriati
    3 visualizzazioni19 pagine

    Micro Revision 1 Solved

    Caricato da

    David
    Solving problems in the field of economics !

    Copyright:

    © All Rights Reserved
    Scarica in formato PDF o leggi online su Scribd
    Segnala contenuti inappropriati
    di 19
    MICROECONOMICS 2017. REVISION FOR MIDTERM 1. MICROECONOMICS 2017 REVISION 1: SELECTION OF QUESTIONS FROM OLD MIDTERMS AND EXAMS. ——————<—$_—— The exercises below are selected from old midterms and assignments. They can be used as additional ‘examples. But they are by all means not the only exercises that appear in the exam. Make sure that you study carefully (understand, not just solve mathematically) all examples done in classes. Chapter Main concepts (class and calculation): - Budget line © Opportunity costs in case of consumer (from budget line) = Transformation curve © Opportunity costs in case of a country (transforation curve) 1. The country produces guns and butter. The transformation curve data is provided in the table below. ‘Guns (units) To [100 [200 | 300 | 400 | 500 Butter (units) | 1000 | 900 | 750 | $50 | 300 [0 Choose the correct answer! a) The opportunity cost of producing 200 guns instead of 100 guns is equal to 750 units of butter ) The opportunity cost of producing 500 guns instead of 300 guns is equal to zero. ‘The opportunity cost of producing 400 guns instead of 100 guns is equal to 500 units of butter. (GD Tre coors eat nay au nb eer ed SO ge guns. ©) None of the above. Calculation: ai Ret AG as 2. Choose the correct statement about the budget line! a) The slope ofthe budget ine gives information about the ratio at which the consumer is wilng to trade one 00d for the other. IDRC: epee b) The budget line represents the entire (all) combinations of goods X and ¥ that a consumer with a given budget can buy. ‘The budget line is decreasing, because the consumer with @ given income must always gWve up a certain ‘amount of one good to increase the consumption of the other. 4) Combinations of goods that are not on the budget line can also be consumed by the consumer with a given level of income €) None of the above. MICROECONOMICS 2017. REVISION FOR MIDTERM 3. 3 Atypical consumer who purchases only goods A and B and has an income M, has the following budget line: Qu=10-20., What is the opportunity cost of buying an additional unit of A? Draw the budget line and aint eo ‘The opportunity cost of an additional unit of A is 0,5 units of B. 1) Thoppertuney stor en aadhionl wit of Ais? omcel <)_Theopportunty cost ofan adonl unit f AsO eur @) —_Theopportnity cost ofan adtona unit of Ais aura oS mmnadhtheabo Calan ae gre. Tele nt Qe 10-8 Oa Te eT Qa-O > Qed QerO > Quel 4 ‘Transformation curve (also known as production possibilities frontier) is given by 3X" + SY*=300. What ‘are the opportunity costs of producing an additional unit of Y, if the country is currently producing § units of X ‘and ison the transformation curve? Draw a picture and provide a calculation! a) 0.45 units of x b) 045 units of. )—-223units of x. 4) 2.23 unitsof. ©) None ofthe above. ‘Calewation and figure. a aks B00 +57" ASS Nh yo Nt ote ~ pee snag = Neos Q Se. OOK = 9,90 ht BV300-S2 + ick 5. The transformation curve for a country, which produces only two goods, x and V, is given by 37+2X=90, Choose the correct answer! a} If only good Vis produced, the country can produce maximum 90 units of good ¥. 15 units of X are produced, then the maximum amount of ¥ produced is 20 units. ©) Opportunity cost of X in the point X=30, ¥=10 is -15, 4) Opportunity cost of x in the point X=30, Y=10 is-2/3. €) None of the above. Gaalation DAK 90 sy oat 4+0 Y tx" Sy*% xt lo k eo ao Brg N=90-30 \=t0 MICROECONOMICS 2017. REVISION FOR MIDTERM 2. 6 Depict the circular flow of goods and incomes in the economy (Hint: Chapter 1) Fockor Faerod HARVET \neouse, me oe onTe ~, companies

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