1. If a company faces a price-elastic demand curve, it can increase the revenue by decreasing the price. True
2. F-test measures the statistical significance of each explanatory variable. True
3. A lawyer whose annual income used to be $150,000 quit the job and opened a restaurant. The total cost of operating the restaurant business is $100,000, and the annual revenue is $250,000. What is the lawyer's economic cost of running the restaurant business?
4. Total revenue function is
TR = -Q(Q-10)
and total cost function is
TC = 2Q.
What is the profit-maximizing Q?
5. What was NOT the effect of the "voluntary export restraint" on Japanese cars in 1981?
Japan started to export high-end automobiles to U.S.
Domestic car prices jumped up.
U.S. consumers had to pay more to purchase cars.
Japanese auto manufacturers suffered a significant decrease in revenue.
US car auto manufacturers enjoyed higher profits.
7. ( ) method is a popular method of qualitative forecasting. Developed at the Rand Corporation in the 1950s, it is utilized predominantly in predicting technological trends and changes. It uses a panel of experts and unlike the jury of executive opinion, the participants do not meet ot discuss and agree on a forecast.
Month Sales 3-Month Moving Average of Sales
Apr 876 1006
May ( )
Note: Do not round the number. Write the whole number.
9. What is time-series data. Give an example. What is cross-sectional data. Give an example.
10. What is the key difference in assumption between a short-run production function and a long-run production function?
Assess a price-elastic demand curve.