| Line 101: |
Line 101: |
| | ==Assignment== | | ==Assignment== |
| | | | |
| − | The assignment is to begin studying for the final exam. These questions are for review only. The answers will be posted on www.conservapedia.com . You do not have to hand in answers.
| + | Please read and, if necessary, reread the above lecture. Then complete 5 out of the following 7 questions (leave TWO blank): |
| | | | |
| − | Need review questions.
| + | 1. Which is true about the average fixed costs (AFC) of a firm? |
| | | | |
| − | 1. The curve that illustrates how much a company or country can produce of multiple items is called the ________________________.
| + | (a)a firm can eliminate these costs by shutting down in the short run. |
| | + | <br>(b) as output increases, AFC decreases |
| | + | <br>(c) as output increases, AFC increases |
| | + | <br>(d) AFC is part of average variable costs |
| | | | |
| − | 2. A monopolistic competitive firm has the following characteristic that is lacking for a perfectly competitive firm: | + | 2. Some politicians complain about how people are losing their jobs to workers in China. Is this problem the result of "free trade" or "protectionism"? |
| | | | |
| − | (a) There are low barriers to entry
| + | 3. What is one of the primary responsibilities of the Federal Reserve Bank? |
| | | | |
| − | (b) MR = MC in the long run. | + | 4. Review: Suppose that after completing this course, you start a new company. In your first year, you "broke even" (had zero profits), and in your second year you want to increase your revenue and profits. After careful study of your market, you decide that you can increase your revenue by increasing your price. Therefore your good must be price elastic/inelastic (choose one). |
| | | | |
| − | (c) P > MC
| + | 5. A monopolistic competitive firm has the following characteristic that is lacking for a perfectly competitive firm: |
| | | | |
| − | (d) There are many competitors. | + | (a) There are low barriers to entry |
| | + | <br>(b) MR = MC in the long run. |
| | + | <br>(c) P > MC |
| | + | <br>(d) There are many competitors. |
| | | | |
| − | 3. A customer to our imaginary homeschool dinner expected to pay $40, but we only charged him $25. An economist would call the $15 difference the ___________. (Hint: see Lecture #10 review list)
| + | Choose one of the above and explain your answer. |
| | | | |
| | + | 6. You can go on www.orbitz.com and watch the price of airline tickets change from day-to-day. If you pick fixed dates of travel, such as Jan. 15 to fly somewhere and Jan. 18 to return, then you notice that the closer you get to those dates, the higher the price of the ticket is. In other words, the earlier in advance that you can buy a ticket, the cheaper it usually is. Explain how this illustrates a basic difference between long run and short run costs. |
| | | | |
| − | 7. Suppose that is your firm in Figure A (attached). What changes might enable you to move production to point D? | + | 7. What is "Keynesian economics" and what is your view of it? |
| | | | |
| − | 8. The term “normal profit” means “zero economic profits,” which occurs when total revenue equals explicit costs (like cash expenditures) plus implicit costs (like opportunity costs of wasted time). In Figure B (attached), at point A, what kind of profits does the company have: (a) more than a “normal profit”, (b) equal to a “normal profit” or (c) less than a “normal profit.”? Explain.
| + | ===Honors:=== |
| | | | |
| − | 9. Do you support “free trade” or “protectionism”? Explain your view.
| + | Complete 2 out of the following 3 questions, and use extra time to fig out the process for you to sign up for the CLEP exam in your area. |
| | | | |
| − | ===Honors:===
| + | 8. Economics is sometimes called the “dismal science” because economists predicted population to grow faster than the food supply, marginal returns to diminish, and profits to vanish. But, in fact, there is an abundance of food and profits have not vanished. Why is economics not so dismal after all? |
| | | | |
| − | 11. Economics is sometimes called the “dismal science” because economists predicted population to grow faster than the food supply, marginal returns to diminish, and profits to vanish. But, in fact, there is an abundance of food and profits have not vanished. Why is economics not so dismal after all?
| + | 9. "Protectionism" is a pejorative (negative) word. Can you think of a more positive, flattering word to express the same concept in a supportive way? |
| | | | |
| | + | 10. Question about monopolistic cmopetition |
| | | | |
| | [[Category:Economics lectures]] | | [[Category:Economics lectures]] |
| | {{DEFAULTSORT: Economics Lecture 13}} | | {{DEFAULTSORT: Economics Lecture 13}} |