1.Please explain why oligopoly is could be treated as an externality phenomenon.

2.What are normal good, inferior good, ordinary good, the Giffen good, necessary good, and luxury good? How do you distinguish them from each other? [hint: the differences in the definitions]

3. Please use the Edgeworth box to explain what is the first welfare theorem?

4. As Summary #9 of Ch. 15 stated that "Income elasticity measures the responsiveness of the quantity demanded to income." Please derive the income elasticity of Cobb-Douglas utility function, using the result from the previous question.

5. What have you learned from Figure 25.1?

6.Summary #4 of Ch. 21Industry Supplystates: "If there are forces preventing the entry of firms into a profitable industry, the factors that prevent entry will earn economic rents. The rent earned is determined by the price of the output of the industry."What does this statement mean? Using an example to argue if you think it is necessary.

7. Why do we claim that "MR=MC" is a so-called "cardinal rule" in production theory?

8. A competitive farm's production function is given by Q = LK(Land), here ( > 0, > 0, > 0) and prices of labor is w, capital is r, and land is "rent". (i) Please write down the profit maximization problem of the farm and its first order conditions (FOCs). (ii) Does "zero profit" condition hold here and how? (iii) Write down the condition for constant returns to scale (CRS) and prove it is true.