Midterm #1 HTML

Economics 243 Midterm #1 Fall 2018
Due in class Monday 8 October 2018.

Self-Timed Limit: 2 Hours

  • You may take a break in the middle, as long as you do not use it to look at notes or otherwise use the time in a manner unfair to your classmates.
  • Read everything before writing anything. Outline your essay before you start. You can’t discuss everything, so think about which points you ought to make.
  • Handwritten is fine. If you type, use a separate sheet or two for graphs and formal models.

Short Answers (60 minutes)
10 minutes each. Answer SIX from the following list of ten. As appropriate, draw a graph or otherwise provide a simple model, or discuss whey the concept is central.

  1. Elasticity and Lerner’s Rule
  2. Herfindahl Index
  3. Hotelling Competition
  4. Efficiency in Monopolies
  5. Entry Barriers
  6. Disruption
  7. Prisoner’s Dilemma
  8. Reaction Curves
  9. Number of Firms
  10. Utility Regulation

Essay (60 minutes)

“One firm is monopoly, two is competition.”

In what sense is this true? false? What differentiates different cases? Employ jargon and, when relevant, empirical examples. Of course you should sketch a formal model or two to illustrate your argument. Go for the jugular: note what you understand to be the major issues, but given time constraints, detail only 2-3 examples.