Econ B251 Final Exam ACTUAL
QUESTIONS AND CORRECT ANSWERS
Sue quit her $40,000 per year job and opened a coffee shop that she calls Top
Brew. In the first year, Top Brew earned $200,000 in revenue. For the same
year, Top Brew paid $80,000 to employees in wages, spent $40,000 on
ingredients such as coffee beans, $15,000 rent for the building to house Top
Brew. Assuming no depreciation in the value of the equipment she's using, Sue's
economic profit from Top Brew for the year is: - CORRECT ANSWERS
25,000
Which of the following are examples of implicit opportunity costs for the firm?
Choose all that apply.
A- Interest Forgone
B-Depreciation
C-The Owner's Income
D-Rent Payments
E-Workers' Salaries
F-The Owner's Time
G-Utility Cost - CORRECT ANSWERS A, B, F
Having equal amount of information is known as______________information. -
CORRECT ANSWERS symmetric
The principal-agent problem suggests - CORRECT ANSWERS
principals and agents are more likely to have the same goals if the agent's
pay is tied to satisfying the principal's goals.
In a perfectly competitive market there are many buyers, ____________ sellers
producing _________________ products. _______________ have full
information and ________________ have market power. - CORRECT
, ANSWERS many, many, identical, Buyers and Sellers, neither buyers
nor sellers
The short run is a period of time in which - CORRECT ANSWERS the
quantity used of at least one factor of production is fixed
The above table shows the total product of producing pizzas. The marginal
product of the 4th worker is equal to _____ pizzas. - CORRECT ANSWERS
5
The above table shows the total product of producing pizzas. Diminishing
returns begins when the pizzeria hires the fourth worker. - CORRECT
ANSWERS 4th
Which of the following are characteristics of perfect competition?
A-The market demand curve is downward sloping.
B-Few buyers
C-Many sellers
D-There are no barriers to entry or exit.
E-Firms determine their own prices.
F-Firms produce slightly different products. - CORRECT ANSWERS A,
C, D
The profit maximizing level of output for the perfectly competitive firm occurs
where - CORRECT ANSWERS Price=Marginal Cost
The above table shows the total cost of producing pizzas. The market for pizzas
is perfectly competitive. The equilibrium market price of a pizzas is $18.00.
Given this information, the profit maximizing output is __________ pizzas. -
CORRECT ANSWERS 3
QUESTIONS AND CORRECT ANSWERS
Sue quit her $40,000 per year job and opened a coffee shop that she calls Top
Brew. In the first year, Top Brew earned $200,000 in revenue. For the same
year, Top Brew paid $80,000 to employees in wages, spent $40,000 on
ingredients such as coffee beans, $15,000 rent for the building to house Top
Brew. Assuming no depreciation in the value of the equipment she's using, Sue's
economic profit from Top Brew for the year is: - CORRECT ANSWERS
25,000
Which of the following are examples of implicit opportunity costs for the firm?
Choose all that apply.
A- Interest Forgone
B-Depreciation
C-The Owner's Income
D-Rent Payments
E-Workers' Salaries
F-The Owner's Time
G-Utility Cost - CORRECT ANSWERS A, B, F
Having equal amount of information is known as______________information. -
CORRECT ANSWERS symmetric
The principal-agent problem suggests - CORRECT ANSWERS
principals and agents are more likely to have the same goals if the agent's
pay is tied to satisfying the principal's goals.
In a perfectly competitive market there are many buyers, ____________ sellers
producing _________________ products. _______________ have full
information and ________________ have market power. - CORRECT
, ANSWERS many, many, identical, Buyers and Sellers, neither buyers
nor sellers
The short run is a period of time in which - CORRECT ANSWERS the
quantity used of at least one factor of production is fixed
The above table shows the total product of producing pizzas. The marginal
product of the 4th worker is equal to _____ pizzas. - CORRECT ANSWERS
5
The above table shows the total product of producing pizzas. Diminishing
returns begins when the pizzeria hires the fourth worker. - CORRECT
ANSWERS 4th
Which of the following are characteristics of perfect competition?
A-The market demand curve is downward sloping.
B-Few buyers
C-Many sellers
D-There are no barriers to entry or exit.
E-Firms determine their own prices.
F-Firms produce slightly different products. - CORRECT ANSWERS A,
C, D
The profit maximizing level of output for the perfectly competitive firm occurs
where - CORRECT ANSWERS Price=Marginal Cost
The above table shows the total cost of producing pizzas. The market for pizzas
is perfectly competitive. The equilibrium market price of a pizzas is $18.00.
Given this information, the profit maximizing output is __________ pizzas. -
CORRECT ANSWERS 3
