Exercises for chapter1 Microeconomics

Exercises for chapter1 Microeconomics extra materials for Microeconomics Seventh Edition 7th N.Greogory Mankiw Business Administration (Faculty of Business Administration) Exercises for practice. Bài tập môn kinh tế Vĩ mô, chương 1.

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EXERCISES FOR FINAL TEST TYPE 1: SUPPLY, DEMAND AND GOVERNMENT POLICIES

Exercise 1: Consider the supply and demand schedule for good X as follow:

D None of the above

3 Marker equilibrium price and quantity are

A P = 20, Q = 10

B P = 10, Q = 20

C P = 20, Q = 20

D None of the above

4 If Government imposes a price ceiling of 25$/kg, what will happen in the market?

A There will be a surplus in the market

B There will be a shortage in the market

C Market still operates at the equilibrium status

D None of the above

5 If Government imposes a price ceiling of 15$/kg, what will happen in the market?

D None of the above

6 At the equilibrium point, demand is

A Relatively elastic

B Relatively inelastic

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C Unitary elastic

D None of the above

7 Price elasticity of supply at the equilibrium point is

A E = 0,6

B E = 0,4

C E = 0,2

D None of the above

8 If Government imposes an excise tax of t = 2$/kg on seller then

A Demand curve shift upward by a distance of t

B Demand curve shift downward by a distance of t

C Supply curve shift upward by a distance of t

D Supply curve shift downward by a distance of t

9 (Continue question 8) New market equilibrium price and quantity are

A P = 20,57; Q = 9,71

B P = 22, Q = 10,4

C P = 22; Q = 9

D None of the above

10 (Continue question 8) Deadweight loss caused by tax is

A DWL = 0,29

B DWL = 0,58

C DWL = 15

D None of the above

Exercise 2: Suppose the market for good X has supply schedule and demand schedule:

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B P = 48 – 2,5Q

C P = - 48 + 2,5Q

D None of the above

3 Market equilibrium price and equilibrium quantity are

A Q = 37; P = 34

B Q = 34; P = 37

C Q = 24; P = 17

D None of the above

4 Consumer surplus at the equilibrium point is

A CS = 841,75

B CS = 722,5

C CS = 840

D None of the above

5 Price elasticity of demand at the equilibrium point is

A E = - 0,67

B E = - 0,87

C E = - 0,73

D None of the above

6 If Government imposes a tax of 2000$/ton on seller then

A Demand curve shift to the right

B Demand curve shift to the left

C Supply curve shift to the right

D Supply curve shift to the left

A P = 33,47; Q = 37,67

B Q = 33,47; P = 37,67

C Q = 33; P = 37

D None of the above

A DWL = 0,527

B DWL = 0,627

C DWL = 0,727

D None of the above

9 If Government imposes a price ceiling of 30000$/ton, what will happen in the market?

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A A shortage because this price ceiling is not binding

B A shortage because this price ceiling is binding

C A surplus because this price ceiling is not binding

D A surplus because this price ceiling is binding

10 (Continue question 9) Calculate the consumer surplus?

A CS = 936

B CS = 960,5

C CS = 987,875

D None of the above

Exercise 3: Suppose the market for good A has supply schedule and demand schedule:

D None of the above

2 The supply function is

A P = - 2,5Q + 50

B P = 2,5Q + 55

C Q = 0,4P - 20

D None of the above

3 The equilibrium price and equilibrium quantity is

A Q = 50; P = 175

B Q = 55; P = 175

C Q = 60; P = 175

D None of the above

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5 Total surplus at the equilibrium point is

A TS = 15870

B TS = 18570

C TS = 18750

D None of the above

A E = - 1,75

B E = -7

C E = -8,75

D None of the above

7 If Government imposes a price ceiling of 165$/unit, what will happen in the market?

A A shortage because this price ceiling is not binding

B A shortage because this price ceiling is binding

C A surplus because this price ceiling is binding

D Neither a shortage nor a surplus because this price ceiling is not binding

8 (Continue question 7) The actual quantity transacted in the market is

A Q = 46

B Q = 50

C Q = 70

D None of the above

9 (Continue question 7) Consumer surplus is

A CS = 1061

B CS = 1071

C CS = 1081

D None of the above

10 (Continue question 7) Calculate the deadweight loss?

A DWL = 424

B DWL = 216

C DWL = 24

D None of the above

Exercise 4: Suppose the market for good A has supply function and demand function:

P = 200 – 0,5Q and P = 50 + 0,25Q (P: $/unit, Q: unit)

1 The equilibrium price and quantity is

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A P = 100, Q = 200

B P = 100, Q = 300

C P = 200, Q = 100

D None of the above

A E = 0,125

B E = 2

C E = 8

D None of the above

3 Producer surplus at the equilibrium point is

A PS = 3500

B PS = 3750

C PS = 5000

D None of the above

A TS = 15000

B TS = 20000

C TS = 25000

5 If government imposes a price ceiling of 120$/unit, what will happen in the market?

A A shortage because this price ceiling is binding

B A shortage because this price ceiling is not binding

C A surplus because this price ceiling is binding

D Neither a shortage nor a surplus because this price ceiling is not binding

6 Government imposes a tax of 15$/unit on seller, calculate new equilibrium price and

quantity?

A P = 110, Q = 180

B P = 110, Q = 200

C P = 180, Q = 110

D None of the above

7 (Continue question 6) Calculate the total tax revenue of government?

A TR(tax) = 3000$

B TR(tax) = 2700$

C TR(tax) = 1650$

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D None of the above

8 (Continue question 6) Calculate the tax burden for buyer?

A 900$

B 1600$

C 1800$

D None of the above

9 (Continue question 6) Calculate the tax burden for seller?

A 900$

B 1600$

C 1800$

D None of the above

A DWL = 100$

B DWL = 150$

C DWL = 200$

D None of the above

Exercise 5: Suppose the market for good A has supply and demand function as follow:

D None of the above

A CS = 62

B CS = 72

C CS = 144

D None of the above

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4 Government imposes a tax of 3000$/ton on seller, what will happen in the market?

A Demand curve shift to the left

B Demand curve shift to the right

C Supply curve shift to the left

D Supply curve shift to the right

5 (Continue question 4), new equilibrium price and quantity are

A P = 37; Q = 13

B P = 35; Q = 13

C P = 37; Q = 11

D None of the above

6 Because of a rise in buyers’ income, the quantity demanded increase 3 tons at every

single price level What will happen in the market?

7 (Continue question 6) New market equilibrium price and quantity is

A P = 37,3; Q = 12,7

B P = 38; Q = 13

C P = 37; Q = 14

D None of the above

8 If government imposes a price floor of 42000$/ton, calculate producer surplus?

A PS = 18

B PS = 56

C PS = 144

D None of the above

9 (Continue question 8) Calculate total surplus?

A TS = 126

B TS = 162

C TS = 216

D None of the above

10 (Continue question 8) Calculate deadweight loss?

A DWL = 54

B DWL = 162

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C DWL = 216

D None of the above

Exercise 6: Suppose the market for good A has supply and demand function as follow:

D None of the above

A CS = 36

B CS = 18

C CS = 48

D None of the above

A E = 1,56

B E = 2,33

C E = 14

D None of the above

4 Government imposes a tax of 2000$/ton on the seller, what happen in the market?

A Demand curve shift to the left

B Demand curve shift to the right

C Supply curve shift to the left

D Supply curve shift to the right

5 (Continue question 4) New equilibrium price and quantity are

A Q = 5,5; P = 28

B P = 6; Q = 29

C Q = 5,5: P = 28,5

D None of the above

6 Because of a rise in buyers’ income, the quantity demanded increase 4 tons at every

single price level What will happen in the market?

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7 (Continue question 6) New equilibrium price and quantity are

A P = 7; Q = 31

B P = 31; Q = 7

C P = 17; Q = 21

D None of the above

8 Government imposes a price floor of 24000$/ton, the actual quantity transacted in the

market is

A Q = 4

B Q = 6

C Q = 10

D None of the above

9 (Continue question 8) Compare to question 2, consumer surplus will

A Increase

B Decrease

C Remain unchange

D Cannot be determined whether it increase or decrease or remain unchange

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C E = -3

D None of the above

A CS = 135 million VND

B CS = 45 million VND

C CS = 180 million VND

D None of the above

4 Producer surplus at the equilibrium point is

A PS = 135 million VND

B PS = 45 million VND

C PS = 180 million VND

D None of the above

A TS = 135 million VND

B TS = 45 million VND

C TS = 180 million VND

D None of the above

6 If Government imposes a tax of t=20000/kg on seller, what will happen in the market?

A Demand curve shift upward by a distance of t

B Supply curve shift upward by a distance of t

C Supply curve shift downward by a distance of t

D None of the above

9 (Continue question 6) Tax burden for buyer is

A 25 million VND

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B 30 million VND

C 12,5 million VND

D None of the above

A 500.000 VND

B 1 million VND

C There is no DWL

D None of the above

Exercise 8: Market for good X has supply function: Q = 3P + 15 At the price level of P=10,

demand is unitary elastic Assume that when P = 10, Q = 20 (P: $, Q: kg)

D None of the above

A CS = 205

B CS = 215

C CS = 225

D None of the above

A E = 0,5

B E = 1,5

C E = 2,5

D None of the above

5 If Government imposes a price ceiling of 10$, what will happen in the market?

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D None of the above

6 If Government imposes a price ceiling of 3$, what will happen in the market?

D None of the above

7 (Continue question 6) The actual quantity transacted in the market is

A Q = 20

B Q = 24

C Q = 34

D None of the above

8 If Government imposes an excise tax of 2$/kg on seller, new equilibrium price and

quantity are

A P = 27,6; Q = 6,2

B P = 5,2; Q = 27,6

C P = 6,2; Q = 27,6

D None of the above

9 (Continue question 8) Who has to bear a larger part in the tax incidence?

A Buyer bears a larger part in the tax burden

B Seller bears a larger part in the tax burden

C Buyer and seller bear the same portion in the tax burden

D None of the above

10 Assume that the quantity demanded in the market increases by 5kg at every price

level New market demand function is

A P = -2Q + 45

B P = -0,5Q + 22,5

C Q = -2P + 22,5

D None of the above

Exercise 9: Suppose the market for good Y has 2 buyers with individual demand function

Q: ton)

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1 Market demand function is

A Q = 100 – P

B Q = 100 – 2P

C Q = 120 – 4P

D None of the above

2 Equilibrium price and quantity are

A P = 30; Q = 40

B P = 35; Q = 40

C P = 30; Q = 45

D None of the above

A TS = 750.000$

B TS = 800.000$

C TS = 1.600.000$

D None of the above

A E = - 3/8

B E = - 1/2

C E = - 3/2

D None of the above

5 If Government imposes an excise tax of 5000$/ton on seller, new market equilibrium

price and quantity are

A P = 32,5; Q = 35

B P = 35,2; Q = 35

C P = 35; Q = 32,5

D None of the above

6 (Continue question 5) Tax burden for seller is

A 67.500$

B 87.500$

C 175.000$

D None of the above

7 If Government imposes a price floor of 34000$/ton and buys all the surplus amount,

the real quantity transacted in the market is

A Q = 30

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B Q = 32

C Q = 48

D None of the above

8 (Continue question 7) Producer surplus is

A PS = 288.000$ C PS = 576.000$

B PS = 512.000$ D None of the above

9 (Continue question 7) Consumer surplus is

A CS = 384.000$ C CS = 192.000$

B CS = 256.000$ D None of the above

10 (Continue question 7) Calculate the deadweight loss in this case?

A DWL = 18.000$ C DWL = 80.000$

B DWL = 58.000$ D There is no DWL

Exercise 10: The market for good X is determined by supply and demand function as

follow: P = 60 - 0,5Q and P = 5 + Q/9 (P: $/kg; Q: tons)

1 Equilibrium price and quantity are, respectively

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6 (Continue question 5) What is the benefit of subsidy for each party?

A 1,64$/kg for buyers and 0,36$/kg for sellers

B 0,36$/kg for buyers and 1,64$/kg for sellers

C Buyers receive 2$/kg and sellers get nothing

D Sellers receive 2$/kg and buyers get nothing

7 (Continue question 5) Calculate the deadweight loss in this case?

A 3,28$

B 3.280$

C 3.820$

D None of the above

8 Assume that quantity demanded increases by 10% at every price level, what are new

equilibrium price and quantity?

A 97,2$/kg and 15,8 tons

B 15,8$/kg and 97,2 tons

C 13,8$/kg and 93,2 tons

D None of the above

9 (Continue question 8) Calculate the total surplus?

A 524.880$

B 4.296.240$

C 4.821.120$

D None of the above

10 Assuming that quantity supplied decreases 2 tons at every price level, what are new

equilibrium price and quantity?

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TYPE 2: PERFECT COMPETITION Exercise 1: A perfectly competitive firm has costs function as follow:

D None of the above

2 (Continue question 1) The maximum profit of this firm is

A 𝜋 = 128

B 𝜋 = 138

C 𝜋 = 148

D None of the above

3 (Continue question 1) Producer surplus of this firm is

A PS = 338

B PS = 348

C PS = 358

D None of the above

4 The break-even quantity of this firm is

A Q = 10

B Q = 20

C Q = 30

D None of the above

5 The break-even price of this firm is

A P = 30

B P = 40

C P = 50

D None of the above

6 The shut-down price of this firm is

A P = 9

B P = 10

C P = 11

D None of the above

7 If the market price is 42$, firm will

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A Continue producing at Q = 8

B Earn economic profit 𝜋 = 72$

C Suffer a loss of 72$

D Both A and C are correct

8 If the market price is 8$, firm should

A Continue producing

B Stop producing

C Exit the market

D None of the above

9 In short-run, the supply function of this firm is

A P = 2Q + 10

B Q = 0,25P + 2,5

C Q = 0,25P – 2,5

D None of the above

10 Assume that the market contains 20 firms, each firm has identical supply function

Market supply function is

A Q = 5P + 50

B P = 0,2Q - 0,02

C P = 0,2Q + 0,02

D None of the above

Exercise 2: A perfectly competitive firm has average total cost function as follow:

D None of the above

2 If the market price is 50$, the optimal quantity of this firm is

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A 𝜋 = 376

B 𝜋 = 476

C 𝜋 = 576

A PS = 526

B PS = 556

C PS = 576

D None of the above

A Q = 10

B Q = 20

C Q = 30

D None of the above

A P = 22

B P = 23

C P = 24

D None of the above

7 The shut-down price of this firm is

A P = 1

B P = 2

C P = 3

A P = 2Q – 2

B Q = 0,5P – 0,5

C Q = 0,5P – 1

9 If the market price is 10$, price elasticity of supply is

A E = 5/4

B E = 2

C E = 3/2

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10 Assume that there are 20 firms in the perfectly competitve market, each firm has

identical supply function Market supply function in short-run is

A Q = 10P – 10

B P = 0,1Q + 1

C P = 0,1Q + 2

Exercise 3: A perfectly competitive firm has average total cost function as follow:

D None of the above

A Q = 10

B Q = 20

C Q = 30

D None of the above

A 𝜋 = 65

B 𝜋 = 75

C 𝜋 = 85

D None of the above

A PS = 90

B PS = 100

C PS = 110

D None of the above

A Q = 5

B Q = 10

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C Q = 15

D None of the above

A P = 5

B P = 15

C P = 25

D None of the above

A P = 3

B P = 4

C P = 5

A Q = 0,5P – 0,5

B Q = 0,5P – 2,5

C Q = 0,5P – 5

9 In short-run, if the market price is 10$, firm should

B Stop producing

C Exit the market

D None of the above

10 If the market price is 10$, price elasticity of supply is

A E = 4/3

B E = 5/4

C E = 3/2

D None of the above

Exercise 4: A perfectly competitive firm has MC = 2Q + 1, FC = 289 (P: $/unit, Q: unit)

1 Average variable cost function of this firm is

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2 Total cost function of this firm is

A TC = Q2 + 2Q + 1

B TC = Q2 + 2Q + 289

C TC = Q2 + Q + 289

D None of the above

A P = Q + 1

B Q = -1/2 + P/2

C Q = 2Q + 11

D None of the above

A Q = 20

B Q = 25

C Q = 30

D None of the above

A 𝜋 = 610

B 𝜋 = 611

C 𝜋 = 612

D None of the above

A PS = 850

B PS = 875

C PS = 900

D None of the above

A Q = 17

B Q = 18

C Q = 19

D None of the above

A P = 33

B P = 34

C P = 35

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D None of the above

B Stop producing

C Exit the market

D None of the above

10 If the market price is 5$, the price elasticity of supply is

A E = 1/4

B E = 5/4

C E = 5

D None of the above

Exercise 5: A perfectly competitive firm has total cost function as follow:

D None of the above

2 Marginal cost function of this firm is

A MC = 2Q + 1

B MC = 2Q + 5

C MC = Q + 5

D None of the above

A Q = 20

B Q = 25

C Q = 30

D None of the above

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A PS = 425

B PS = 525

C PS = 625

D None of the above

A Q = 20

B Q = 25

C Q = 30

D None of the above

A P = 35

B P = 40

C P = 45

D None of the above

8 In short-run, the supply curve of this firm is

A P = 2Q – 5

B Q = 0,5P + 2

C Q = 0,5P – 2,5

9 If the market price is 20$, the price elasticity of supply is

A E = 4/3

B E = 5/4

C E = 16/3

D None of the above

B Shut down

C Exit the market

D None of the above

1 Average variable cost function of this firm is

A AVC = Q + 1

Tiêu đề	Exercises for Final Test
Người hướng dẫn	PTS. Nguyễn Việt Hòa
Trường học	Foreign Trade University
Chuyên ngành	Microeconomics
Thể loại	bài tập

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