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Queen’s Econ 110 Final Exam -Spring Newest Exam
Preparation With Complete Questions And Correct
Answers With Rationales ||Verified Exam!!| Already
Graded A+||Newest Version!!!
Producers will bear a larger burden if____ - Answer-
Demand is relatively elastic and supply is inelastic
(demand is more flat negative slope and supply has steep
positive slope)
The two characteristic problems for cartels are: - Answer-
Policing members' output restrictions and preventing new
entrants (this is why there are thing's like medical
licenses).
Suppose Harrison Ford Makes 2 movies per year and
earns $10M/movie. The next best alternative is
commercials earning $0.5M/year. What is his economic
rent if he makes movies? - Answer-He is earning
economic rent of $19,500,000/year
If the world price is set at $t, higher than the equilibrium for
a certain country's good. Would it import or export? -
Answer-The country would export because the suppliers
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now want to produce at the point that matches the world
price, so there would be an excess supply equal to the
triangle formed between the equilibrium, and the points on
the demand curve and supply curve at $t.
At a garage sale, Ken purchases a bicycle for $8, he was
willing to pay $25 and it costs $75 new. What is Ken's
consumer surplus? - Answer-$17. Consumer surplus is the
difference between what the consumer values the product
or service at and what they actually paid. ($25-$8)
What are explicit costs? - Answer-These are actual
purchases of goods and services by the firm.
What are implicit costs? - Answer-Are costs that
accountants ignore because there is no actual market
transaction for them but there is an opportunity cost. For
example use of company assets, time spent on
something.
A downward sloping LRAC curve will shift downward
because of _____ - Answer-a decrease in factor prices.
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What are increasing returns to scale? - Answer-A situation
in which output increases more than in proportion to inputs
as the scale of a firm's production increases. A firm in this
situation is a decreasing cost firm.
What is the relationship between LRAC and SRATC? -
Answer-No short-run cost curve can fall below the long-
run cost curve because the LRAC curve is the lowest
attainable cost for each possible output. It is tangent to the
minimum of every possible SRATC
Any point below the LRAC represents____ - Answer-
unattainable cost levels. You can have costs higher than
the LRAC but that is when production is running
inefficiently.
If money income is reduced by half, and the prices of all
goods consumed by the household are reduced by half,
the household's budget line will____ - Answer-not change.
They can still buy the exact same quantities as before
because even though they only have half as much money,
everything costs half as much
Queen’s Econ 110 Final Exam -Spring Newest Exam
Preparation With Complete Questions And Correct
Answers With Rationales ||Verified Exam!!| Already
Graded A+||Newest Version!!!
Producers will bear a larger burden if____ - Answer-
Demand is relatively elastic and supply is inelastic
(demand is more flat negative slope and supply has steep
positive slope)
The two characteristic problems for cartels are: - Answer-
Policing members' output restrictions and preventing new
entrants (this is why there are thing's like medical
licenses).
Suppose Harrison Ford Makes 2 movies per year and
earns $10M/movie. The next best alternative is
commercials earning $0.5M/year. What is his economic
rent if he makes movies? - Answer-He is earning
economic rent of $19,500,000/year
If the world price is set at $t, higher than the equilibrium for
a certain country's good. Would it import or export? -
Answer-The country would export because the suppliers
,2|Page
now want to produce at the point that matches the world
price, so there would be an excess supply equal to the
triangle formed between the equilibrium, and the points on
the demand curve and supply curve at $t.
At a garage sale, Ken purchases a bicycle for $8, he was
willing to pay $25 and it costs $75 new. What is Ken's
consumer surplus? - Answer-$17. Consumer surplus is the
difference between what the consumer values the product
or service at and what they actually paid. ($25-$8)
What are explicit costs? - Answer-These are actual
purchases of goods and services by the firm.
What are implicit costs? - Answer-Are costs that
accountants ignore because there is no actual market
transaction for them but there is an opportunity cost. For
example use of company assets, time spent on
something.
A downward sloping LRAC curve will shift downward
because of _____ - Answer-a decrease in factor prices.
, 3|Page
What are increasing returns to scale? - Answer-A situation
in which output increases more than in proportion to inputs
as the scale of a firm's production increases. A firm in this
situation is a decreasing cost firm.
What is the relationship between LRAC and SRATC? -
Answer-No short-run cost curve can fall below the long-
run cost curve because the LRAC curve is the lowest
attainable cost for each possible output. It is tangent to the
minimum of every possible SRATC
Any point below the LRAC represents____ - Answer-
unattainable cost levels. You can have costs higher than
the LRAC but that is when production is running
inefficiently.
If money income is reduced by half, and the prices of all
goods consumed by the household are reduced by half,
the household's budget line will____ - Answer-not change.
They can still buy the exact same quantities as before
because even though they only have half as much money,
everything costs half as much
