College Scholastic Aptitude Test ( ) For Class of 2010 -ECONOMICSOriginal: 20 questions, 30 minutes This version: 3 questions, 5 minutes

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3. The chart shows data of a certain corporations production of Product X. Which is the correct analysis? (Assume the entire production will be sold.) Amount of raw material used in 1 2 3 4 5 6 production (unit) Cost of raw material per unit 3 3 3 3 3 3 (KRW 10,000 won) Amount of Product X produced 5 12 18 23 27 29 (unit) Market price of Product X 1 1 1 1 1 1 (KRW 10,000 won) (1) Productivity is continuing to increase. (2) The maximum possible profit is KRW 290,000 won. (3) The profit is the greatest when 5 units of raw material is used in production. (4) The marginal cost of production as the raw material used in production is increased by 1 unit increases. (5) When the amount of the raw material used in production increases from 2 units to 3 units, the additional sales revenue is KRW 30,000 won.

12.

What is the correct statement about the subsidy policy presented in the material below?

In order to stimulate the consumption of Product X, the government decided to make subsidy payments; it is now considering the following two proposals: Proposal 1: Provide the purchasers with a subsidy in the amount of KRW a won per unit of Product X. Proposal 2: Provide the sellers with a subsidy in the amount of KRW a won per unit of Product X.

In the graph, D and S respectively are the demand and supply curves before the subsidy. D is the demand curve after Proposal 1 is implemented. (Assume all demand and supply curves are straight lines.) [In the graph, the y-axis is labeled price, and x-axis is labeled amount.] (1) If Proposal 2 is implemented, the supply curve will shift upward by KRW a won.

(2) The amount of transactions involving Product X will be greater under Proposal 1 than Proposal 2. (3) The equilibrium price after the subsidy payment is higher under Proposal 1 than under Proposal 2 by KRW a won. (4) For purchasers, Proposal 1 is more advantageous than Proposal 2. (5) The total amount of subsidy payment is greater under Proposal 2 than under Proposal 1.

18.

What are the right inferences from the choices regarding the data presented below?

The Lorenz curve of Country X passes through Point A. The Lorenz curve of Country Y passes through Points B and C. The Lorenz curve of Country Z passes through Points B and D. [The y-axis of the graph is labeled, cumulative share of income. The x-axis of the graph is labeled, cumulative ratio of the population.]

<CHOICES> (a) Country Bs Lorenz curve cannot pass through Point E. (b) 80% of Country Cs population has the same income. (c) The Lorenz curves of Countries B and C cannot intersect in the area of the cumulative ratio of the population of 60% or above. (d) Based only on the data presented above, it is not possible to calculate the Gini coefficient for any of the countries. (1) (2) (3) (4) (5) (a), (b) (a), (c) (b), (c) (b), (d) (c), (d)