ECO402 Fall 2011 Final Term Feb 2012

ECO402 Fall 2011 Final Term Feb 2012 – VU Current Paper – 03 Feb 2012

Total 64
56 mcqs
8 short questions
Give some examples of third-degree price discrimination. 3 marks
If the marginal cost of production is greater than the average variable cost, does this tell you whether the average
variable cost is increasing or decreasing? Explain. 3 marks
What is meant by non price competition? Why do monopolistic competitors engage in it while perfectly competitive firms do not? 3 marks
Give an example of monopoly power in factor markets. What is the primary determinant of controlling wage and economic rent? 3 marks
Define two-part tariff. Also give examples to support your answer. 5 marks
How is a computer company’s demand for computer programmers a derived demand? 5 marks
Differentiate between supply curve and demand curve. What are the non price determining variables of supply? (Marks:

What is meant by rent seeking? What are the different ways of rent seeking? 5 marks