华东师范大学期末试卷（A）ECNU Final Exam (A)2018——2019学年第2学期2nd Semester, 2018-2019 课程名称Course Name：学生姓名Student Name：学号Student ID：专业Major：年级/班级Class：课程性质：公共必修√、公共选修、专业必修、专业选修1 Multiple Choice (Pick one answer for each question. 5 points each)1) ________ are sources of market failure.A) Private goods B) Competitive activities C) Externalities D) All of the above are correct.2) Assume that the price underestimates the value that society places on the flu vaccine. If firms produce where P = MC, firms will be producing ________ the socially efficient amount of flu vaccine.A) exactlyB) more thanC) less thanD) sometimes more than and sometimes less than3) Suppose you know that the breakfast cereal industry is characterized by significant ʺbarriers to entryʺ. Which of the following is a correct inference?A) Economic profits in the breakfast cereal industry are likely to persist, ceteris paribus.B) The breakfast cereal industry could be an unregulated, perfectly competitive industry.C) The government must be artificially restricting entry into the breakfast cereal industry.D) The breakfast cereal industry is producing a type of public good.4) Which model of oligopoly results in the greatest efficiency?A) oligopoly competition in price with differentiated productsB) oligopoly competition in price with homogeneous productsC) oligopoly competition in quantity with homogeneous productsD) oligopoly competition with collusion5) All of the following are characteristics of monopolistically competitive industries EXCEPT:A) There are no barriers to entry B) Strategic behavior C) Product differentiation D) A large number of firms6) Refer to the above table. Firm Aʹs dominant strategy isA) to advertise.B) to not advertise.C) dependent on what Firm B does.D) indeterminate from this information, as no information is provided on Firm Aʹs risk preference.7) When a sales tax is imposed on the sellers,A) only sellers pay the taxB) sellers and buyers share the tax according to their price elasticitiesC) only buyers pay the taxD) none of the above8) Private goods are ________ in consumption and their benefits are ________.A) rival; excludableB) nonrival; excludableC) nonrival; nonexcludableD) rival; nonexcludable9) You own the only stall selling orange juice in a school cafeteria. Your cost for producing one cup of orange juice is $1. Currently, you are charging the same price for one cup of orange juice from every student. If the demand function is p=11-q. What is your profit maximizing price?A) $10B) $9C) $6D) $110) (continuing the last question) You discover that students after PE class buy more orange juice from you. On the other hand, students after a class on calculus appear to be neutral to buying the orange juice. What type of pricing strategy should you use to maximize your profit?A) charging uniform priceB) practice first degree price discriminationC) practice second degree price discriminationD) practice third degree price discrimination2. Long Questions (Please write down how you get your answers.)11) (25 points) suppose the government pays $2 to the buyers of a good for each unit of the good they purchase. The diagram below shows the demand and supply for this good.a) (5 points) What is the original consumer surplus without subsidy?b) (5 points) What is the original producer surplus without subsidy?c) (5 points) What is the consumer surplus after the subsidy is given?d) (5 points) What is the producer surplus after the subsidy is given?e) (5 points) Will your answers change if the subsidy is given to the producers instead of the buyers?(You can use letter, for example, A+B, to answer these questions.)Answer：a) The original consumer surplus without subsidy is A+B.b) The original producer surplus without subsidy is D+E.c) The consumer surplus after the subsidy is given is A+B+D+F+H.d) The producer surplus after the subsidy is given is B+D+E+C.e) The answers will not change if the subsidy is given to the producers instead of the buyers, because of the neutrality of subsidy.12) (25 points) There are two firms producing robots in a market. Each firm has two options: producing high quality robots or producing low quality robots. If both firms produce high quality robots, each firm gets a profit of $500. If both firms produce low quality robots, each firm gets a profit of $400. If firm A produces high quality robots and firm B produces low quality robots, firm A gets $800 and firm B gets $600. If firm A produces low quality robots and firm B produces high quality robots, firm A gets $600 and firm B gets $800.a) (5 points) If the two firms make decisions simultaneously, please draw the payoff matrix.b) (5 points) Is there any dominant strategy in this game?c) (5 points) Is there any pure strategy Nash equilibrium in this game?d) (5 points) If firm A makes decision first and firm B makes decision after observing firm A’s decision, please draw the game tree.e) (5 points) What is the subgame perfect equilibrium of this sequential move game?Answer:b) There is no dominant strategy in this game.c) There are two pure strategy Nash equilibria in this game: (high quality, low quality) and (low quality, high quality).d) high quality high qualityFirm A----------------- Firm B-----------------（500,500）| || low quality | low quality| || high quality （800,600）Firm B-----------------（600,800）|| low quality|（400,400）e) The subgame perfect equilibrium of this sequential move game is (high quality, low quality).华东师范大学期末试卷（A）ECNU Final Exam (A)2018——2019学年第2学期2nd Semester, 2018-2019课程名称Course Name：学生姓名Student Name：学号Student ID：专业Major：年级/班级Class：课程性质：公共必修√、公共选修、专业必修、专业选修。