Information for questions 10-15 The figure below shows indifference curves for a consumer who consumes good X (on the horizontal axis) and good Y (on the vertical axis). The utilities of the indifference curves are 100, 200, 300, 400, and 500 (it’s up to you to determine which indifference curve corresponds to which utility). Note: the answers to the questions in this group won’t be exact. To have exact answers, we’d need an exact utility function and take derivatives. Since all we have are graphs, the answers will necessarily be approximate. The point is to make the best approximations that you can, using the limited graphical information. To see the figure as clearly as you can, try to have it on a computer screen and enlarge it; also, use a ruler. Enter all answers as positive numbers. Your answer must be within the approximation specified in each question. If the answer cannot be obtained from the figure, even as an approximation, enter 0. How much of the increase in Y calculated in the previous question can be attributed to the substitution effect only? To be right, your answer must be within 2 units of the best approximation possible from the figure.

Information for questions 2-8 The figure below shows supply and demand for a certain good. On the horizontal axis, the quantity Q has grid spacing of 10 units of the good. On the vertical axis, each grid spacing represents $0.5.  Adhere to the following convention, which is necessary to get exact answers: if a line (the supply curve or the demand curve) seems to cross an intersection of the grid, then by convention assume that it does. For example, the tip of the supply line seems to be at P=5, Q=160, so we’ll assume that it crosses the grid at exactly that point, that is, that when the price P=5, then the supply is Q=160, exactly. All answers are positive numbers, except (possibly) the answer to question 7. Only exact answers are accepted, so please make sure to check and doublecheck your reasoning and your calculations. If the answer cannot be obtained with the information given, enter the number 0. The government imposes a sales tax on this good of $1.50 per unit sold. Calculate the government revenue received from this tax.

Consider the set of assumptions on the left. We have used them in the theory of consumer choice. Each assumption leads to one and only one of the conclusions on the right. Match each assumption to its conclusion.  In case they’re not fully legible, the full texts of the conclusions on the right are (in some order): Indifference curves cannot cross. Indifference curves cannot be “thick,” such that two consumptions bundles A and B, in which A is above and to the right of B, cannot be on the same indifference curve. Indifference curves are convex toward the origin. There must be an indifference curve through every point.

Information for questions 2-8 The figure below shows supply and demand for a certain good. On the horizontal axis, the quantity Q has grid spacing of 10 units of the good. On the vertical axis, each grid spacing represents $0.5.  Adhere to the following convention, which is necessary to get exact answers: if a line (the supply curve or the demand curve) seems to cross an intersection of the grid, then by convention assume that it does. For example, the tip of the supply line seems to be at P=5, Q=160, so we’ll assume that it crosses the grid at exactly that point, that is, that when the price P=5, then the supply is Q=160, exactly. All answers are positive numbers, except (possibly) the answer to question 7. Only exact answers are accepted, so please make sure to check and doublecheck your reasoning and your calculations. If the answer cannot be obtained with the information given, enter the number 0. The government imposes a sales tax on this good of $1.50 per unit sold. Enter the (after-tax) price that consumers pay per unit bought.

Information for questions 21-25 The inverse demand for food in a country is given by

Information for questions 9-16 Demand and supply are given by the two equations: QD = 100 – 20 P and QS = 80 P, respectively. Here, QD is quantity demanded, QS is quantity supplied, and P is the price. Suggestion: draw a neat figure with these two curves, and make the figure roughly on scale. Use the figure just to keep track of the numbers that you calculate, don’t read any answers off the figure. Only the exact answer is accepted, so make sure to doublecheck your calculations. Enter 0 if the answer cannot be determined from the information given. For questions 15 and 16 only: suppose that the government imposes a price floor of $2. Starting from the free market equilibrium, when the price floor is imposed

Information for questions 9-16 Demand and supply are given by the two equations: QD = 100 – 20 P and QS = 80 P, respectively. Here, QD is quantity demanded, QS is quantity supplied, and P is the price. Suggestion: draw a neat figure with these two curves, and make the figure roughly on scale. Use the figure just to keep track of the numbers that you calculate, don’t read any answers off the figure. Only the exact answer is accepted, so make sure to doublecheck your calculations. Enter 0 if the answer cannot be determined from the information given.  Calculate the demand choke price.

13 (6 pts). Open the following graph: graph13.docx (a) What is the area of the Triangle as a percentage of the Octagon? (b) What is the area of the Rectangle as a percentage of the Octagon?   14 (6 pts). A person deposits $2000 in a bank account. If the bank pays the rate of 6.5% interest compounded annually, how much will the account be worth after 6 years?   15 (8 pts). Let x be the age of Bernie. Form algebraic expressions for the following: (a) Bernie’s age in six years. (b) Bernie’s age four years ago. (c) The age of Bernie’s little brother, who is half of Bernie’s age. (d) The age of Bernie’s father, who is three times of Bernie’s age.

There are only 3 consumers in a market, Angel, Berry, and Cameron. Their demands for a certain good are given by QA=100–2P, QB=200–4P, and QC=50–P, respectively. Enter the equation for the market demand in the blank below. To be graded correctly, your answer must be exactly in the format “Q=M-NP”, where M and N are whole numbers for you to calculate and enter in place of M and N. Note that there are no spaces, and Q and P are in capitals. So, for example, answer “Q=26-4P” would be accepted (if the numbers 26 and 4 were the correct ones), but answers “Q = 26 – 4P” would not be accepted (it has spaces), nor would answer “q=26-4p” (did not capitalize q and p).

4 (6 pts). Suppose a person is paid $75 after working 6 hours for a job. (a) How much will the person earn for 11 hours? (b) How many hours are needed for the person to earn $400?   5 (6 pts). Determine which one is cheaper: A 18-ounce bottle of orange juice at $3.59 or a 14-ounce bottle at $2.95.   6 (6 pts). Suppose a car uses 5.4 gallons of gas travelling 150 miles. At the same rate, how many gallons would it use on a trip of 200 miles.