ECON10004 Microeconomics 2011 past exam paper - 2800 Words

THE UNIVERSITY OF MELBOURNE DEPARTMENT OF ECONOMICS SEMESTER 1 ASSESSMENT, 2011 ECON10004 INTRODUCTORY MICROECONOMICS Time Allowed: TWO hours Reading Time: 15 minutes This examination paper contributes 60% to the assessment in ECON10004. The Response Sheet for the multiple-choice questions should be inserted in the back of the examination script book at the end of the examination. For the multiple-choice questions, you may use the examination script books to make notes or calculations. These notes will NOT be taken into account for your assessment. SECTION A: ANSWER ALL QUESTIONS This section is worth 25% of the total exam marks. Answer all questions. Fill in the small circle in the appropriate place with a 2B†¦show more content†¦b) Impose a tax of 250 on each individual who obtains a university degree. c) Provide a subsidy of 250 to each individual who acquires a university degree. d) Require that at least 150 persons obtain a university degree. Q5 Daniel’s Deepdish Pizza has costs as follows: Quantity of pizzas per day FC MC 1 10 1 2 10 1 3 10 2 4 10 2 5 10 3 6 10 3 7 10 4 8 10 4 9 10 5 10 10 5 Daniel knows that – over the range from 1 to 10 pizzas per day – his ATC will: a) Continuously increase. b) Continuously decrease. c) Increase and then decrease. d) Decrease and then increase. Q6 Joy’s Superwash Carwash can use two alternative methods of production. The FC and VC of each of these methods are shown below: Method 1 Method 2 Output FC VC FC VC 1 1 1 10 1 2 1 3 10 2 3 1 6 10 3 4 1 10 10 4 5 1 15 10 5 6 1 21 10 6 7 1 28 10 7 8 1 36 10 8 In the long-run Joy should choose: a) To only use production method 1 b) To use production method 1 if output is less than or equal to 4 units, and production method 2 if output is 5 units and above c) To use production method 2 if output is less than or equal to 4 units, and production method 1 if output is 5 units and above d) To use production method 1 if output is less than or equal to 5 units, and production method 2 if output is 7 units and above Q7 Mac’s Luxury