NAME: _____________________________________________________ MICROECONOMICS FINAL EXAM Background: You are the Chief Operating Officer of a medium sized business

manufacturing __________________ (student selects product), in a market that can best be characterized as having monopolistic competition. You will present an overview of the business' competitive environment, operating costs, and product pricing for the upcoming year at the annual shareholders meeting. Write a draft of your overview presentation. Your audience includes many visual learners, so you must include diagrams whenever possible. Their knowledge of Economics is similar to yours' back in early October, so you must focus on basics and simple explanations for all terms and concepts.. In this presentation, devote a short paragraph to explain and illustrate each of the following items. You may use bullet points to list characteristics. Be sure to use topic sentences for each paragraph and present your material in the order shown.. 1) Characteristics of Monopolistic Competition 2) Elasticity of Demand for your product including a non-scaled diagram 3) Substitute and Complementary goods that pertain to your product (name at least 3 for each type of good) 4) Whether or not your product is a Normal or Inferior Good. 5) Your Operating Costs, by category including a non-scaled diagram. 6) Why the curves are shaped as they are. 7) Pricing of your good in regards to your Demand Curve, including possible short term Economic Profit including a non-scaled diagram. 8) How Economic Profit differs from Accounting Profit. 9) If the possibility exists that your company might have to Shut Down or Exit the Market this year including an explanation of why or why not including a non-scaled diagram. 10) How expanding your plant might lead to economies of scale and greater profits including a non-scaled diagram. Writing Time: 90 minutes maximum Each of the ten (10) aspects of the presentation is worth 10 points. Maximum score 100 points.

RUBRIC Aspect Explanation Complete (Y=Yes, P=Partial, N=No) Points Y=10 P=7 N=4 Aspect Explanation Complete (Y=Yes, P=Partial, N=No) Points Y=5 P=3 N=1 Diagram Complete (Y=Yes, P=Partial, N=No) Points Y=5 P=3 N=1

1 3 4 6 8 SUBTOTAL TOTAL xxxxxxxxxx

2 5 7 9 10 xxxxx xxxxxxxxxx xxxxxxxx