Step By Step Responses To Any/All Of These Questions 6379. Step by step responses to any/all of these questions

Practice Questions, MT II.pdf

Name:__________________________________

McMaster I.D. #__________________________

McMaster University

Economics 2GG3

Dr. Robert Jefferson

Mid Term Examination 2

Practice Questions

Instructions:

1.

2.

3.

On the FRONT of your Scantron (SIDE 1), fill out the items in the box at the top (your

McMaster i.d. number, name, date, signature, course, section (C01), instructor name (R.

Jefferson)

On the FRONT of your Scantron (SIDE 1) use a dark lead pencil to bubble in your Student

Number, the Version number (#), and your section number (001).

Leave blank Sheet Number and Seat Number.

Be sure to fill in # in the column marked “VERSION”

4.

You have 90 minutes. No student may leave before 8:00. Hand in the computer card AND

the question paper.

5. There are 30 multiple-choice questions. Answer by completely filling in the box. If you

change an answer then completely erase your previous answer.

You will be given one mark for each correct answer and zero marks for missing, incorrect or

multiple answers.

6. Permitted examination aid: Casio FX-991 calculator. Dictionaries or any other books are

not permitted.

7. All cell phones, pagers, and other electronic devices must be turned OFF and put away.

Proctors will confiscate any such device seen on the desk of an exam candidate.

1

1.

Diana consumes commodities x and y and her utility function is U(x, y) = xy2.

Good x costs $2 per unit and good y costs $1 per unit.

If she is endowed with 3 units of x and 6 units of y, how many units of good y will she

consume?

a.

b.

c.

d.

2.

Rhoda takes a job with a construction company.

She earns $5 an hour for the first 40 hours of each week and then gets “double-time” for

overtime. That is, she is paid $10 an hour for every hour beyond 40 hours a week that she

works.

Rhoda has 70 hours a week available to divide between construction work and leisure.

She has no other source of income, and her utility function is U = cr, where c is her income

to spend on goods and r is the number of hours of leisure that she has per week.

She is allowed to work as many hours as she wants to.

How many hours will she work?

a.

b.

c.

d.

3.

3

8

11

14

50

30