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Economics Applicant Thread UCAS 2012

I remember seeing a robinson economics test in interview past paper on TSR somewhere, but can't dig it out now, does anyone know where it might be or have it?? I would really appreicate it if someone know how to get it!!

Thanks!

Reply 5581

kaying

2

Original post by MWM

Here is a question I got asked in my mock:

Let the y axis be revenues/costs and the x axis be output.

1) Draw a total revenue curve

2) Draw a total cost curve

3) On the diagram indicate where profits will be maximised

4) How would you find the exact value of output at which profits are maximised.

That is roughly how it went, in the mock the first two questions were already answered for me; I was given a diagram with total costs/revenues, the second question should be easy and the last requires some thinking.
If some one can answer the last question I would be impressed, it takes some thinking and under interview conditions it would be quite tough I reckon.
If people can't answer it then please remember I got asked this in my mock and to the best of my knowledge this isn't a past interview question.
Positive Rating!

Original post by crazy1234

Profit maximizing is when MR=MC, so surely differentiate TR and TC, equal them to each other, solve for Q.

For price, get TR, divide by Q to get AR, then put your q value in an you will get price :smile:

Is that right?

isn't TR = TC where the business breaks even? therefore this isn't profit maximising.
profit maximising is where the difference between TR and TC is the largest.. so the TR curve is linear as each unit of output sees a proportional increase in revenue. and we learnt that the TC curve is also straight... but in the short term, variable costs will be higher than the total revenue because of bulk buying of materials to start with? and so as output increases, TC will eventually be lower than that of TR for profit to occur, as starting costs are met by revenue and then exceeded. so the largest vertical distance between both curves of TR-TC would be profit maximisation.

to find the exact output... i guess there's some maths formulation? or trial and improvement of businesses, if they want to use Total Revenue and Total Costs to find that out.. there are clearly easier ways to find the point of profit maximisation in reality.

Reply 5582

Tateco

OP

14

Original post by crazy1234

Profit maximizing is when MR=MC, so surely differentiate TR and TC, equal them to each other, solve for Q.

For price, get TR, divide by Q to get AR, then put your q value in an you will get price :smile:

Is that right?

Sounds right I think :smile:

Reply 5583

94george94

1

Original post by kaying

isn't TR = TC where the business breaks even? therefore this isn't profit maximising.
profit maximising is where the difference between TR and TC is the largest.. so the TR curve is linear as each unit of output sees a proportional increase in revenue. and we learnt that the TC curve is also straight... but in the short term, variable costs will be higher than the total revenue because of bulk buying of materials to start with? and so as output increases, TC will eventually be lower than that of TR for profit to occur, as starting costs are met by revenue and then exceeded. so the largest vertical distance between both curves of TR-TC would be profit maximisation.

to find the exact output... i guess there's some maths formulation? or trial and improvement of businesses, if they want to use Total Revenue and Total Costs to find that out.. there are clearly easier ways to find the point of profit maximisation in reality.

MR=0 is the Revenue Max position.

So differentiate TR to find the max point. Input the X value when MR=0. This should give us max revenue.

If TC is straight then find the Y value of TC when we input the X value when MR=0. This is the lowest TC when TR is maximum.

TR Max - TC with X value when MR=0 = Profit Max.

Just my idea. :colondollar:

Reply 5584

Tomatochuckers

18

Original post by Hackett

offer from Manchester!

Well done! :smile:

Reply 5585

crazy1234

Original post by kaying

isn't TR = TC where the business breaks even? therefore this isn't profit maximising.
profit maximising is where the difference between TR and TC is the largest.. so the TR curve is linear as each unit of output sees a proportional increase in revenue. and we learnt that the TC curve is also straight... but in the short term, variable costs will be higher than the total revenue because of bulk buying of materials to start with? and so as output increases, TC will eventually be lower than that of TR for profit to occur, as starting costs are met by revenue and then exceeded. so the largest vertical distance between both curves of TR-TC would be profit maximisation.

to find the exact output... i guess there's some maths formulation? or trial and improvement of businesses, if they want to use Total Revenue and Total Costs to find that out.. there are clearly easier ways to find the point of profit maximisation in reality.

Yeah when TR and TC are furthest away, there gradients are the same hence MR(the differential of TR)=MC

Reply 5586

Tateco

OP

14

Original post by 94george94

MR=0 is the Revenue Max position.

So differentiate TR to find the max point. Input the X value when MR=0. This should give us max revenue.

If TC is straight then find the Y value of TC when we input the X value when MR=0. This is the lowest TC when TR is maximum.

TR Max - TC with X value when MR=0 = Profit Max.

Just my idea. :colondollar:

You're confusing revenue maximisation with profit maximisation

Reply 5587

94george94

1

Original post by Tateco

You're confusing revenue maximisation with profit maximisation

Yeah I realised after I posted, too busy watching a documentary to correct myself though.

Reply 5588

MWM

Original post by MWM

Here is a question I got asked in my mock:

Let the y axis be revenues/costs and the x axis be output.

1) Draw a total revenue curve

2) Draw a total cost curve

3) On the diagram indicate where profits will be maximised

4) How would you find the exact value of output at which profits are maximised.

That is roughly how it went, in the mock the first two questions were already answered for me; I was given a diagram with total costs/revenues, the second question should be easy and the last requires some thinking.
If some one can answer the last question I would be impressed, it takes some thinking and under interview conditions it would be quite tough I reckon.
If people can't answer it then please remember I got asked this in my mock and to the best of my knowledge this isn't a past interview question.
Positive Rating!

If anyone is interested here are my answer, they are correct to the best of my knowledge.

1) Because I can't draw it here I will describe it best I can:
Starting from (0,0) TR rises with a high initial gradient but the gradient falls as output rises.
Try an imagine a y^2=x but only the part above the x - axis.
2) TC rises with output starting form (0,0) it has a low initial gradient and it's gradient increases at a increasing rate.
Imagine a y=x^2 but only for x is larger than 0.

These were given to me in the question.

3) This is where there is the biggest gap between TR and TC.

4) Some of you are getting this wrong because you are assuming TC is linear.

Let the curve for TC = f(x)
TR = g(x)

As profit = TR-TC
Profit = h(x)= g(x)-f(x)
work out h'(x), equate it to zero to get the point of profit maximisation.

Reply 5589

MWM

Original post by 94george94

MR=0 is the Revenue Max position.

So differentiate TR to find the max point. Input the X value when MR=0. This should give us max revenue.

If TC is straight then find the Y value of TC when we input the X value when MR=0. This is the lowest TC when TR is maximum.

TR Max - TC with X value when MR=0 = Profit Max.

Just my idea. :colondollar:

This isn't revenue maximisation, you are just assuming that the biggest gap between TR and TC is when TR is at it's max, which might not necessarily be the case.

Reply 5590

jacky23

has everyone who has applied to UCL been asked for their UMS?

Reply 5591

zxh800

13

Original post by jacky23

has everyone who has applied to UCL been asked for their UMS?

They don't ask you, you give it to them. Read your acknowledgement e-mail.

Reply 5592

WalkerPrince

1

Original post by MWM

Offer from Bath, first offer so I am glad. I was using the strategy of applying to 4 uni's (Cam, LSE, War and Bath) and if I get an offer from one of them before mid December I would apply to UCL (which I have just done) and If I heard nothing till mid December I would apply to York.
Now that I have applied to UCL can I just ask how they collected everyone's UMS ? I have put them in my UCAS form but should I still be expecting an email asking for them, or should I email them my UMS ?

Very smart! How a good economist would make the decision :biggrin:

We are applying to EXACTLY the same universities, now you've added UCL. :cool:

Reply 5593

WalkerPrince

1

Original post by crazy1234

Profit maximizing is when MR=MC, so surely differentiate TR and TC, equal them to each other, solve for Q.

For price, get TR, divide by Q to get AR, then put your q value in an you will get price :smile:

Is that right?

Sort of what I thought! Happy :smile:

Reply 5594

MWM

Original post by jacky23

has everyone who has applied to UCL been asked for their UMS?

I applied today, but haven't got any email, when did you apply, when did you get the email ?

Reply 5595

MWM

Original post by crazy1234

Profit maximizing is when MR=MC, so surely differentiate TR and TC, equal them to each other, solve for Q.

For price, get TR, divide by Q to get AR, then put your q value in an you will get price :smile:

Is that right?

When you equate the differentials of TR and TC then you are not solving for output, you are solving for the point where they both have the same gradient. I don't think such a solution would exists though.

Reply 5596

MWM

Original post by WalkerPrince

Very smart! How a good economist would make the decision :biggrin:

We are applying to EXACTLY the same universities, now you've added UCL. :cool:

Thanks, I saw some of your lectures, well done btw :smile:

Did you get asked for your UMS form UCL?

Reply 5597

zxh800

13

Original post by jacky23

I received this email...

Many thanks for applying to UCL and the Faculty of Social and Historical Sciences. We were pleased to receive your application which is now being considered for the BSc(Econ) Economics programme.

Our degree programmes attract a large number of well qualified applicants so it may be some time before we can give you a decision. We shall, however, endeavour to consider your application as quickly as we can.

You will be contacted again regarding the progress of your application. This may take the form of a request for further information, an invitation to an Open and/or Interview Day, or notification of our final decision. In the event that your application should prove to be unsuccessful, this notification will come direct from UCAS.

Please do not reply to this email. In addition, please do not send or email any further information or documentation unless requested to do so by the Faculty or the Department.

Once again, thank you for your interest in studying at UCL.

With best wishes.

Yours sincerely

Robin D.S Allan
Acting Faculty Tutor

This was what was said on mine:

If you have completed, or are studying A-levels, you were able to provide details of your UMS marks in your UCAS application. If you did not provide this information then we would be grateful if you could email it to [email protected], including your UCAS Personal ID.

Reply 5598

WalkerPrince

1

Original post by MWM

When you equate the differentials of TR and TC then you are not solving for output, you are solving for the point where they both have the same gradient. I don't think such a solution would exists though.