AGB 524 Final
Assume that the demand for chicken sandwiches in your local market is Qd = 10,000 - 4000P, where P = price of the chicken sandwich and Qd = quantity demanded of chicken sandwich. The daily supply function is Qs = 1000 + 6000P. The producer surplus is
$2,880
If the own-price elasticity of demand at the mean is -0.09, the coefficient on the own price in the demand function is -3.3457, and the average quantity is 95.26. The average price is
$2.56
Assume that the demand for chicken sandwiches in your local market is Qd = 10,000 - 4000P, where P = price of the chicken sandwich and Qd = quantity demanded of chicken sandwich. The daily supply function is Qs = 1000 + 6000P. The consumer surplus is
$5,120
Assume that a monopolist is facing an inverse demand function in one market of P1 = 90 - 3Q1, and an inverse demand function in a second market of P2 = 80 - 4Q2. Also assume that for technical reasons, the marginal cost of producing for the first market is MC1 = 30, and the MC of producing in the second market is MC2 = 40. At profit maximizing quantity produced, the price determined by the monopolist in the first market is
$70/unit
Assume that a monopolist is facing an inverse demand function in one market of P1 = 90 - 3Q1, and an inverse demand function in a second market of P2 = 80 - 4Q2. Also assume that for technical reasons, the marginal cost of producing for the first market is MC1 = 30, and the MC of producing in the second market is MC2 = 40. The profit maximizing quantity produced the price determined by the monopolist in the second market is
$70/unit
Assume that the demand for chicken sandwiches in your local market is Qd = 10,000 - 4000P, where P = price of the chicken sandwich and Qd = quantity demanded of chicken sandwich. The daily supply function is Qs = 1000 + 6000P. The total surplus the the local economy is
$8,000
A sales manager for an advertising agency believes that there is a relationship between the number of contacts that a salesperson makes and the amount of sales dollars earned. A regression analysis shows the following results Coef Stnd Error t-stat p-val Intercepts -12.201 6.560 -1.860 0.100 # of cont 2.195 0.176 12.505 0.000 What is the Y-intercept of the linear equation?
-12.201
When expressed as a percentage, what is the range of values for multiple R^2?
0% to 100% inclusive
Year Broilers ($/lb) CPI (Base = 1965) Real Prices 1992 0.318 132 0.241 1993 0.340 129 0.264 1994 0.350 127 0.276 1995 0.344 122 A 1996 0.381 113 B The values of A and B are
0.282 and 0.337
Assume that a monopolist is facing an inverse demand function in one market of P1 = 90 - 3Q1, and an inverse demand function in a second market of P2 = 80 - 4Q2. Also assume that for technical reasons, the marginal cost of producing for the first market is MC1 = 30, and the MC of producing in the second market is MC2 = 40. The profit maximizing quantity produced by the monopolist in the first market is
10 units
The current level of stocks for corn is 14 million bushels. The current use of corn is 10 million bushels. What is the stock to use ratio?
140%
if the coefficient of multiple determination is 0.81, what percent of variation is not explained?
19%
A sales manager for an advertising agency believes that there is a relationship between the number of contacts that a salesperson makes and the amount of sales dollars earned. A regression analysis shows the following results Coef Stnd Error t-stat p-val Intercepts -12.201 6.560 -1.860 0.100 # of cont 2.195 0.176 12.505 0.000 What is the slope of the linear equation>
2.195
Assume that the total cost function (TC) is given by the following equation: TC = 100 + 2.5y +0.05y^2, where y is output. What is the marginal cost when output y is 10 units?
2.5
TC = 100 + 2.5y + 0.05y^2, where y is output. The marginal cost (cost for producing every additional unit of y) is:
2.5 + 0.10y
In a regression analysis, three IV are used in the equation based on a sample of 58 observations. In the ANOVA table for a multiple regression analysis, what are the degrees of freedom associated with the F-statistic?
3 and 54
Given the least squares regression, Yhat = 1,202 + 1,333X, when X = 3, what does Yhat equal?
4,601
Given the least squares regression, Yhat = 1,228 + 1,159X, when X = 3, what does Yhat equal?
4,705
John's lawn mowing service is a small business that acts as a price taker. The prevailing market price of lawn mowing is $25 per acre. John's costs are given by TC = 0.2q^2 + 5q + 50. Where q = the number of acres john chooses to cut a day. What is the total profit at maximizing acres?
450
Assume that a monopolist is facing an inverse demand function in one market of P1 = 90 - 3Q1, and an inverse demand function in a second market of P2 = 80 - 4Q2. Also assume that for technical reasons, the marginal cost of producing for the first market is MC1 = 30, and the MC of producing in the second market is MC2 = 40. The profit maximizing quantity produced by the monopolist in the second market is
5 units
John's lawn mowing service is a small business that acts as a price taker. The prevailing market price of lawn mowing is $25 per acre. John's costs are given by TC = 0.2q^2 + 5q + 50. Where q = the number of acres john chooses to cut a day. How many acres should John mow per day to maximize profits?
50
All other things being held constant, what is the change in the dependent variable for a unit change in X1 for the multiple regression equation: Yhat = 5.2 + 6.3X1 - 7.1X2
6.3
Which of the following is correct?
A change in the price of a good has a total effect on consumption that can be decomposed into two different parts: income effect and substitution effect
What can we conclude if the global test of regression rejects the null hypothesis?
At least one of the regression coefficients is not equal to zero.
Which of the following is correct?
CPI is constructed based on Laspeyres Price Index
which statistic is used to test a global hypothesis about a multiple regression equation?
F-statistic
Which one of the following is not true?
In US agricultural product prices are determined through government regulation only
The profit maximizing quantity for a firm is determined at a point where
MR = MC
Which of the following is true of the fundamentals of regression analysis?
Regression uses an estimation procedure called ordinary least squares that guarantee the line if estimates will be the best fitting line
In the regression equation, what does the letter alpha represent?
The Y intercept
Which of the following is true of a beta coefficient?
a beta coefficient shows the change in the DV for each unit change in the IV
Autarky
a closed economy that does not trade with others, and is economically independent
Which of the following is true of relationships between variables?
a linear relationship is much simpler to work with the a curvilinear relation ship
In multiple regression analysis a dummy variable is
a nominal variable with only two values
Under the framework of a contract theory the person who makes the allocation decision is called
a principal
What is the chart called when the paired data are plotted?
a scatter diagram
A situation where some characteristic of the Agent is not observable by the Principal and is typically found in the case of health insurance market with only those higher than the average risk are willing to purchase the insurance, is defined as
adverse selection
A sales manager for an advertising agency believes that there is a relationship between the number of contacts that a salesperson makes and the amount of sales dollars earned. What is the dependent variable?
amount of sales dollars
In multiple regression analysis, testing the global null hypothesis that all regression coefficients are zero is based on _______.
an F-statistic
Institutional factors such as government programs
are both direct and implicit supply control
Paasche Quantity Index uses
base year price as the weight
Laspeyres Price Index uses
base year quantity as the weight
in the US "farm products" are generally produced in more ___________ markets, while "food products" tend to be sold in markets that are more ___________.
competitive; oligopolistic
Which one is not one of the three types of goods defined by income effects?
complimentary goods
Transfer costs include all of the following, except
cost of producing a commodity
Soybean oil and soybean meal are the joint products. If the price of soybean oil decreases, the supply of soybean meal will
decrease
The price of Kellogg's Frosted Flakes (which is highly demand elastic) is $3.00 per box. The price of the closet substitute "Sweet Flakes" is $2.50 per box. Now the price of "Sweet Flakes" decreases to $2.00 per box. What do you think will happen to the demand for Frosted Flakes?
decrease
US acreage control program for corn would __________ its export of corn and _________ the world price of corn.
decrease; increase
US ethanol mandate program for corn would ________ its export of corn and ________ the world price of corn.
decrease; increase
The existence of stock supply puts a(n) __________ on price.
downward pressure
A restrictive trade policy adopted by a small country will result in negative impacts borne
entirely by the policy adopting country
the demand for goods and services that are not satisfied by domestic producers is defined as:
excess demand
A positive difference between the amount of corn domestic producers are willing to produce and the amount the domestic consumers are willing to buy at the given world price is called ________ __________ of corn.
excess supply
the contract which covers the whole duration of the relationship and it cannot be breached or renegotiated, then such contract is
full commitment
Which of the following is not true for a production contract?
growers completely eliminate production and price risks
Market demand curve is a
horizontal summation of individual demand curves
Export tax on banana by a large exporting country would ________ total welfare of banana and consumers in the domestic market and ________ the welfare of the consumers in the ROW
increase; decrease
US Target price program for corn would _________ consumer welfare in the US and _________ the producer welfare in the ROW
increase; decrease
US target price program for corn would __________ its export of corn and __________ the world price of corn.
increase; decrease
Wool is a joint product for lamb meat. When price of wool increases, the supply of lamb meat is likely to ________ and price of lamb meat is likely to _________.
increase; increase
In regression analysis, what is the predictor variable called?
independent variable
Based on the following demand equation for cotton: Qc = 88.83 - 0.34Pc Suppose that the average quantity consumed, Qc is 63.5 million lbs and the average price paid, Pc is 74.5 cents per pound, the own price elasticty of demand at the means is:
inelastic
The __________ determines the price prevailing in each deficit market.
lowest cost source
Which one of the following does not belong in the group:
luxury good
Assume that the government has placed a regulation on the emission from diesel that will increase the cost of diesel. The impacts of this regulation on the individual producer's MC and Market supply:
marginal cost will increase and market supply will decrease
Which one of the following is not true? As more producers start adopting technology:
market supply begins to shift inward, thus increasing the price
The difference in price between the two market levels represents the
marketing margin
which one does not belong in the following list?
monopsony
when the Agent takes an action that affects the utility of both himself and the Principal; the Principal only observes the outcome, which is an imperfect signal of the action, then such situation is defined as
moral hazard
If a researcher is interested in measuring the effect of two independent variables on a dependent variable, he/she should use:
multiple regression analysis
Stock-to-use ratio is ____________ related with prices of the commodities
negatively
A sales manager for an advertising agency believes that there is a relationship between the number of contacts that a salesperson makes and the amount of sales dollars earned. What is the independent variable?
number of contacts
Kellogg's holding of stocks of corn to process as needed throughout the year called
operational demand of stock
Which one of the following variables relating to the demand for beef is not a demand shifter?
price of beef per pound
A curve showing the technical relationship between inputs and outputs is known as
production function
Which one of the following is correct?
quantity demanded for prom is a dependent variable
the following are the advantages of a contract from the perspective of producers except:
reduced independence
If there are four independent variables in a multiple regression equation, there are also four
regression coefficients (betas)
The farmer's share of retail dollar
simply indicates degree of value added
which statistic is used to test hypotheses about individual regression coefficients with large sample assumption?
t-statistic
Consumer Price Index is a common deflator
that adjusts prices to account for deflation
Which one of the following is correct?
the four explanatory variables collectively explain 85% of the variation in the quantity demanded for pork
In a regression equation, what does beta stand for?
the slope of the line
If the producers are assumed to be risk averse
they will produce at a sub-optimal level
Assuming the demand for agricultural products is inelastic, what would be the impact on total revenue if the supply of agricultural products were restricted by the government
total revenue will increase
The existence of stock demand puts a(n) _________ on price.
upward pressure
A researcher plots a scatter diagram of two variables. The dots on the plot are scattered roughly in a circle. This indicates that the relationship (covariation) between the two variables is:
very close to zero
The stock-to-use ratio for wheat has declined from 120% to 80%. What do you expect will happen to wheat price?
will increase
