Figure A Figure B Figure C Figure D Figure E The ______________ provides a graphical representation of unit elastic demand curve, which the percentage change in quantity demanded equals the percentage change in price

Formula Sheet   HPR = (PS – PB+CF)/PB APR = HPR x 365/t where t=# of days held 1 + EAR = (1 + HPR)n where n is periods per year (or 365/t) 1 + EAR = eAPR rcc = ln(1 + EAR) Arithmetic average = HPRavg =

Figure A Figure B Figure C Figure D Figure E The ______________ provides a graphical representation of  perfectly elastic demand curve, which the percentage change in quantity demanded equals the percentage change in price

We cannot tell whether an additional dollar of income is worth more to a poor person or a rich person, because we do not know those individuals’ preferences with any degree of accuracy. (True/False)

An investor chooses to invest 85% of her wealth in a risky asset P with an expected rate of return of 18% and a standard deviation of 26%, and she puts 15% in a riskless Treasury bill that pays 3%. Let C denote this complete portfolio.   (a) Compute the expected rate of return and standard deviation of portfolio C. (6 points) (b) Draw the Capital Allocation Line (CAL) for this investor. Clearly label the points corresponding to the T-bill, asset P and portfolio C. (5 points) (c) What is the slope of the Capital Allocation Line (CAL)?  What does this slope represent? (5 points) (d) How low would the risk aversion of an investor need to be for them to allocate more than 100% of their wealth to P?  Find the risk aversion level of the investor given her complete portfolio decision above. (5 points)

Please, match the following descriptions with the correct economic concept (Long Run or Short Run)    

Elasticity provides a technique for estimating the response of one variable to changes in some other variable and has numerous applications in economics. Cross elasticity of demand measures _____________________________________  

Based on the information in the table for a perfectly competitive firm, The marginal cost of the 2th unit (A) is _________________

The 6th amendment prohibits cruel and unusual punishment 

  Average Fixed Cost (AFC): Total fixed cost (TFC) divided by quantity of output  Average Variable Cost (AVC): Total variable cost (TVC) divided by quantity of output Average Total Cost (ATC): Total cost (TC) divided by quantity of output MC indicates marginal cost.  Based on the above plot (c) (1)_____________ continuously declines as the quantity of output rises, because (2)____________ is constant.