3. Which of the following statements is correct?
(A) Marginal cost is constant.
(B) Marginal revenue is constant.
(C) Market demand curve is sloping downward.
(D) Supply curve is vertical.

4. Suppose you are the only one who provides lemonade on the NTPU campus. (You are a local monopoly.) What price would you charge? (A) $6 (B) $5 (C) $4 (D) $3

5. Suppose you are facing the same cost schedule and your classmates are free to start a new lemonade stand to compete with you (You are facing perfect competition.) However, the market price for a lemonade is 3 dollars each now. What is your economic profit per hour? (A) $5 (B) $3 (C) $1 (D) $0

6. In the figure on the above, the marginal cost curve is curve (A) A. (B) B. (C) C. (D) D.

7. Uber Eats and Food Panda must decide whether or not to start a promotional campaign in the Sanxia area. The potential economic profit by each food delivery services, depicted in the payoff matrix above, depends on whether the other service also start a campaign. Which of the following statements is true? (A) If Food Panda starts a campaign and Uber Eats does not, Food Panda will earn a $20 million economic profit. (B) If Uber Eats starts a campaign and Food Panda does not, Uber Eats will earn a $20 million economic profit. (C) The Nash Equilibrium of the game is when both Food Panda and Uber Eats do not a campaign. (D) Food Panda and Uber Eats can work out a joint strategy that can generate an outcome better than the Nash Equilibrium. Price (dollars per kilogram) Quantity (kilograms of salmons)

8. In the figure above, which movement represents an increase in quantity demanded but NOT an increase in demand? (A) From point c to point a. (B) From point c to point b. (C) From point c to point d. (D) From point c to point e.

9. The indifference curve in the figure on the above (A) illustrates two goods that are perfect substitutes. (B) illustrates two goods that are perfect complements. (C) violates assumptions about preferences. (D) illustrates the utility function of \( \mathrm{U} = \max \) (quantity of good A, quantity of good B)

10. Simpsons will temporarily lay off 300 workers as the company stops production of the flying car, Batmobile, for a month. Simpsons had hoped to sell 100 Batmobile last year, but fell short of the expectation. Under what conditions would this shutdown decision maximize Batmobile's economic profit? (A) When the price of Batmobile is less than the average variable cost (AVC) (B) When marginal revenue (MR) of Batmobile is less than the average total cost (ATC). (C) When the price of Batmobile is less than the average fixed cost (AFC) (D) When the price of Batmobile is less than the average total cost (ATC).

11. Statistics shows that wedding spending declines when the economic prospect is gloomy negative. Which of the following statements is correct? (A) Wedding events are a normal good. (B) Wedding events are an inferior good. (C) Wedding events are a Giffen good. (D) Wedding events are a superior good.

12. Wedding events are not mandatory because couples can simply marry at the district offices. Based on the observation, wedding events are (A) a luxury good and their income elasticity of demand is greater than 1 (B) a luxury good and their income elasticity of demand is less than 1 (C) a necessity good and their income elasticity of demand is greater than 1 (D) a necessity good and their income elasticity of demand is less than 1

13. What is his expected wealth and utility respectively? (A) $3,000, 120 (B) $2,000, 90 (C) $3,000, 90 (D) $2,000, 60

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