Topics: Supply and demand, Variable cost, Costs Pages: 7 (1909 words) Published: March 18, 2013
Higher Colleges of Technology
ADMC Campus

EMBA 610: Managerial Economics

Due Date: Friday September 28, 2012

email: tel: 050 503 1730

hct-emba 610 Q&As to midterm exam – akp sept-oct 2012

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You should be prepared to answer the variety of the questions relying on course materials, lectures, personal experiences, additional information about the content etc. to arrive at your own views on the subject. Be sure to justify your views.

1) Grading Criteria for Essay Questions on Examination
The outcomes of this mid-term exam will be assessed using exclusively the following criteria and weights Mid-term exam

1) Demonstrate understanding of major issues posed by the question 2) Completeness & accuracy of calculations made 3) Appropriate analysis; valid arguments; appropriate supportive details 4) Demonstrated ability to employ terms,concepts and frames of reference from texts, journals & other course mtrl 5) Professional Presentation (Language & Format) TOTAL

0.00 0.00

20% 20%

0.00% 0.00%




0.00 0.00

20% 20% 100%

0.00% 0.00% 0.00%

2) Notification
Please note that the use of other student’s work, submitting this exam’s answers written wholly or partly by other(s), “rendering” on electronically available sources and collaborating without the professor’s permission, constitutes a serious violation of the standards for this exam and will not be considered for grading.

hct-emba 610 Q&As to midterm exam – akp sept-oct 2012

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Suppose you have recently applied for the position of economist to the Global Investment Authority (GIA) a highly reputable government Investment fund organization. GIA’s management informed you that organization’s policy requires all applicants to write some sort of examination around key terms and concepts in economics with emphasis on managerial economics for managers. Their decision to hire you would depend exclusively on the quality of your answers, the way they will be presented and the justifications of own views put forward.

SECTION I – Multiple Choice Questions (circle one answer)
Q1) Assume the equilibrium price of sparkling water to be $3.00 per litre, and that the government sets a price ceiling of $1.50 per litre. The most likely result of this action will be: a) there will now be an excess demand for sparkling water b) the market price of sparkling water will remain at $3.00 per litre, c) there will be a large reduction in the quantity of sparkling water demanded d) the market price of sparkling water will fall because the price ceiling will create an excess supply.

Q2) Assume a firm produces one unit of output and its total revenue function is TR = 200Q - 20Q2. What would its average revenue equal to? a) b) c) d) 180 20 200 220

hct-emba 610 Q&As to midterm exam – akp sept-oct 2012

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Q3)The price elasticity of demand is: a) the ratio of the percentage change in quantity demanded to the percentage change in price. b) the responsiveness of revenue to a change in quantity. c) the ratio of the change in quantity demanded divided by the change in price. d) the response of revenue to a change in price.

Q4) If demand is price elastic, then: a) a rise in price will raise total revenue. b) a fall in price will raise total revenue. c) a fall in price will lower the quantity demanded. d) a rise in price won't have any effect on total revenues.

Q5) The price elasticity of demand generally tends to be: a) smaller in the long run than in the short run. b) smaller in the short run than in the long run. c) larger in the short run than in the long run. d) unrelated to the length of time.

hct-emba 610 Q&As to midterm exam – akp sept-oct 2012

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Q6) If the price elasticity of supply of...
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