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EC248 MIDTERM 1 2024|Questions Solved 100% Correc $13.24   Add to cart

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EC248 MIDTERM 1 2024|Questions Solved 100% Correc

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  • EC248

EC248 MIDTERM 1 2024|Questions Solved 100% Correc

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  • September 8, 2024
  • 10
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers
  • EC248
  • EC248
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KenAli
EC248 MIDTERM 1 2024|Questions
Solved 100% Correct
The following is NOT true when private benefits differ from social benefits
A. price cannot be determined
B. an externality exists
C. resources will be allocated inefficiently
D. market production will not be socially optimal - ✔A. price cannot be determined

Perfect competition does not rule out
A. externalities
B. market power
C. market failure
D. limited information - ✔D. limited information

Asymmetry of information occurs when
A. buyers and sellers are not fully informed
B. it is costly to gather information
C. buyers and sellers have the same information
D. sellers have more information than buyers - ✔D. sellers have more information than
buyers

Monopsony refers to
A. a single supplier in the market
B. a single buyer in the market
C. a barrier to entry to the market
D. an important policy tool - ✔B. a single buyer in the market

I assume that you will received 10 utils from your first ice cream cone, 7 utils from the
second, and 3 utils from the third. I am following the assumption of A. positive
marginal utility
B. decreasing utility
C. diminishing marginal utility
D. non-satiation - ✔C. diminishing marginal utility

The economic model of consumer choice does not take into
account A. individual preferences

, B. individual goals
C. societal goals
D. constraints faced - ✔C. societal goals

Which statement is NOT true about barriers to entry in a market?
A. may occur naturally
B. may arise artificially
C. may be due to large fixed costs
D. will lead to a monopoly - ✔D. will lead to a monopoly

Market power implies
A. a well functioning market.
B. only market forces set prices.
C. an ability to influence market price.
D. perfect competition. - ✔C. an ability to influence market price.

A shadow price
A. is the value of the next best opportunity
B. is always equal to the market price
C. approximates the true average cost
D. approximates true marginal cost - ✔D. approximates true marginal cost

_________ is NOT a possible outcome of an economic evaluation
A. Incremental Cost-Effectiveness Ratio
B. Incremental Cost-Utility Ratio
C. Net Monetary Benefit
D. Least Cost Alternative - ✔D. Least Cost Alternative

The similarity between Cost-Benefit Analysis, Cost-Effectiveness Analysis and Cost-
Utility Analysis is
A. how the consequences are valued
B. how the consequences are measured
C. how costs are measured
D. how the results are reported - ✔C. how costs are measured

The social optimum occurs when:
A. total benefits have been maximized.
B. total benefits have been minimized.
C. total costs equal total benefits.
D. marginal costs equal marginal benefits. - ✔D. marginal costs equal
marginal benefits.

The human-capital approach may be used in
A. Cost-Benefit Analysis
B. Cost-Effectiveness Analysis

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