Question 1

If the demand for a good is perfectly elastic,then a tax on the good will be paid

Accepted Answer

A) completely by the buyers. 
B) completely by the sellers. 
C) equally by the buyers and sellers. 
D) mostly but not completely by the buyers. 
E) mostly but not completely by the sellers. 
A) completely by the buyers. 
B) completely by the sellers. 
C) equally by the buyers and sellers. 
D) mostly but not completely by the buyers. 
E) mostly but not completely by the sellers.

Question 2

A price ceiling set below the equilibrium price will result in

Accepted Answer

A) excess supply. 
B) excess demand. 
C) the equilibrium price. 
D) an increase in supply. 
E) a decrease in demand. 
A) excess supply. 
B) excess demand. 
C) the equilibrium price. 
D) an increase in supply. 
E) a decrease in demand.

Question 3

Use the figure below to answer the following questions.   Figure 6.2.1
-Refer to Figure 6.2.1.What is the equilibrium wage rate per hour in an unregulated market?

Accepted Answer

A) $4 
B) $6 
C) $8 
D) $10 
E) $12 
A) $4 
B) $6 
C) $8 
D) $10 
E) $12

Question 4

Use the figure below to answer the following questions.   Figure 6.3.3
-Refer to Figure 6.3.3.Suppose a tax of $1 is imposed.In which market would tax revenue be the highest?

Accepted Answer

A) (a) 
B) (b) 
C) (c) 
D) (d) 
E) all markets equally 
A) (a) 
B) (b) 
C) (c) 
D) (d) 
E) all markets equally

Question 5

The buyer pays most of a tax if supply is relatively elastic because

Accepted Answer

A) the buyer cannot easily substitute to other markets. 
B) the seller can easily substitute to other markets. 
C) the government forces the seller to bear the burden. 
D) there is a black market for this good. 
E) the seller cannot easily substitute to other goods. 
A) the buyer cannot easily substitute to other markets. 
B) the seller can easily substitute to other markets. 
C) the government forces the seller to bear the burden. 
D) there is a black market for this good. 
E) the seller cannot easily substitute to other goods.

Question 6

Discrimination allocates scarce housing

Accepted Answer

A) to those who are poor. 
B) based on the self-interest of landlords. 
C) to those who are lucky. 
D) to those whose names are on waiting lists. 
E) to those who are willing and able to pay. 
A) to those who are poor. 
B) based on the self-interest of landlords. 
C) to those who are lucky. 
D) to those whose names are on waiting lists. 
E) to those who are willing and able to pay.

Question 7

An effective minimum wage ________ the firms' surplus and ________ the workers' surplus.

Accepted Answer

A) decreases;increases 
B) increases;increases 
C) decreases;decreases 
D) increases;decreases 
E) has no effect on;has no effect on 
A) decreases;increases 
B) increases;increases 
C) decreases;decreases 
D) increases;decreases 
E) has no effect on;has no effect on

Question 8

Which one of the following statements is false?

Accepted Answer

A) An effective minimum wage sets the wage rate above the equilibrium wage rate. 
B) An effective rent ceiling sets the rent below the equilibrium rent. 
C) An effective rent ceiling leads to a housing shortage. 
D) An effective minimum wage is inefficient. 
E) A minimum wage is a price ceiling in the labour market. 
A) An effective minimum wage sets the wage rate above the equilibrium wage rate. 
B) An effective rent ceiling sets the rent below the equilibrium rent. 
C) An effective rent ceiling leads to a housing shortage. 
D) An effective minimum wage is inefficient. 
E) A minimum wage is a price ceiling in the labour market.

Question 9

In an unregulated housing market with no rent ceiling,

Accepted Answer

A) scarce housing resources are allocated inefficiently. 
B) scarce housing resources are allocated efficiently. 
C) tenants pay a lower rent compared to what they pay in a market with an effective rent ceiling. 
D) landlords receive less compared to what they receive in a market with an effective rent ceiling. 
E) consumer surplus equals producer surplus. 
A) scarce housing resources are allocated inefficiently. 
B) scarce housing resources are allocated efficiently. 
C) tenants pay a lower rent compared to what they pay in a market with an effective rent ceiling. 
D) landlords receive less compared to what they receive in a market with an effective rent ceiling. 
E) consumer surplus equals producer surplus.

Question 10

If the supply of a good is perfectly elastic,then a tax on the good will be paid

Accepted Answer

A) completely by the buyers. 
B) completely by the sellers. 
C) equally by the buyers and sellers. 
D) mostly but not completely by the buyers. 
E) mostly but not completely by the sellers. 
A) completely by the buyers. 
B) completely by the sellers. 
C) equally by the buyers and sellers. 
D) mostly but not completely by the buyers. 
E) mostly but not completely by the sellers.

Question 11

Daisy and Donald live in a community with rent ceilings.Both are looking for an apartment to rent.Daisy has a job paying $10 per hour and Donald has a job paying $8 per hour.Both value an apartment equally.What is the most likely outcome?

Accepted Answer

A) Daisy will spend more time than Donald searching for an apartment. 
B) Donald will spend more time than Daisy searching for an apartment. 
C) Both of them will spend the same amount of time searching for an apartment. 
D) Daisy will find the apartment. 
E) Donald will find the apartment. 
A) Daisy will spend more time than Donald searching for an apartment. 
B) Donald will spend more time than Daisy searching for an apartment. 
C) Both of them will spend the same amount of time searching for an apartment. 
D) Daisy will find the apartment. 
E) Donald will find the apartment.

Question 12

A lottery allocates housing to those

Accepted Answer

A) who are poor. 
B) who share similar views to the owner of the housing. 
C) who are rich. 
D) whose names are on waiting lists. 
E) who are lucky. 
A) who are poor. 
B) who share similar views to the owner of the housing. 
C) who are rich. 
D) whose names are on waiting lists. 
E) who are lucky.

Question 13

If the price of a good is not affected by a tax,then

Accepted Answer

A) supply is perfectly elastic. 
B) demand is perfectly elastic. 
C) the elasticity of supply is greater than the elasticity of demand. 
D) demand is unit elastic. 
E) supply is unit elastic. 
A) supply is perfectly elastic. 
B) demand is perfectly elastic. 
C) the elasticity of supply is greater than the elasticity of demand. 
D) demand is unit elastic. 
E) supply is unit elastic.

Question 14

Use the table below to answer the following questions.
Table 6.2.1  
-Table 6.2.1 gives the supply and demand schedules for teenage labour in Genoa City.There is a minimum wage set at $16 per hour.Suppose a new fast food restaurant opens and increases the quantity demanded of teenage labour by 400 hours per week at each wage rate.The result is

Accepted Answer

A) elimination of teenage unemployment and a wage rate of $17 per hour. 
B) elimination of teenage unemployment,but the wage rate remains at $16 per hour. 
C) some teenage unemployment with the wage rate remaining at $16 per hour. 
D) no change in teenage unemployment because the wage rate rises to $17 per hour. 
E) a surplus of teenage labour. 
A) elimination of teenage unemployment and a wage rate of $17 per hour. 
B) elimination of teenage unemployment,but the wage rate remains at $16 per hour. 
C) some teenage unemployment with the wage rate remaining at $16 per hour. 
D) no change in teenage unemployment because the wage rate rises to $17 per hour. 
E) a surplus of teenage labour.

Question 15

If the penalty on sellers of an illegal good is less than the penalty on buyers of an illegal good,then supply of the good will ________ by ________ demand and the price of the good will ________.

Accepted Answer

A) decrease;more than;rise 
B) decrease;less than;rise 
C) decrease;less than;fall 
D) decrease;more than;fall 
E) increase;less than;rise 
A) decrease;more than;rise 
B) decrease;less than;rise 
C) decrease;less than;fall 
D) decrease;more than;fall 
E) increase;less than;rise

Question 16

In an unregulated housing market with no rent ceiling,

Accepted Answer

A) marginal social cost is greater than marginal social benefit. 
B) marginal social benefit is greater than marginal social cost. 
C) marginal social benefit equals marginal social cost. 
D) marginal social benefit is negative. 
E) marginal social cost is negative. 
A) marginal social cost is greater than marginal social benefit. 
B) marginal social benefit is greater than marginal social cost. 
C) marginal social benefit equals marginal social cost. 
D) marginal social benefit is negative. 
E) marginal social cost is negative.

Question 17

An illegal market in which the equilibrium price exceeds the price ceiling is

Accepted Answer

A) a rental market. 
B) a capital market. 
C) a black market. 
D) an efficient market. 
E) a housing market. 
A) a rental market. 
B) a capital market. 
C) a black market. 
D) an efficient market. 
E) a housing market.

Question 18

Use the table below to answer the following questions.
Table 6.3.1  
-Refer to Table 6.3.1.Suppose a sales tax of $2 a unit is imposed on the good described in the table.The buyers' share of the tax is

Accepted Answer

A) $2.00. 
B) $1.50. 
C) $1.00. 
D) zero. 
E) $2.50. 
A) $2.00. 
B) $1.50. 
C) $1.00. 
D) zero. 
E) $2.50.

Question 19

Use the figure below to answer the following questions.   Figure 6.3.3
-Refer to Figure 6.3.3.Suppose a tax of $1 is imposed.In which market would tax revenue be the lowest?

Accepted Answer

A) (a) 
B) (b) 
C) (c) 
D) (d) 
E) all markets equally 
A) (a) 
B) (b) 
C) (c) 
D) (d) 
E) all markets equally

Question 20

Use the table below to answer the following questions.
Table 6.2.2  
-Table 6.2.2 gives the labour demand and labour supply schedules for low-skilled labour.What is the level of unemployment in millions of hours if the minimum wage is set at $17 per hour?

Accepted Answer

A) 40 
B) 30 
C) 20 
D) 10 
E) zero 
A) 40 
B) 30 
C) 20 
D) 10 
E) zero

If the demand for a good is perfectly elastic,then a tax on the good will be paid

A price ceiling set below the equilibrium price will result in

Use the figure below to answer the following questions. Figure 6.2.1 -Refer to Figure 6.2.1.What is the equilibrium wage rate per hour in an unregulated market?

Use the figure below to answer the following questions. Figure 6.3.3 -Refer to Figure 6.3.3.Suppose a tax of $1 is imposed.In which market would tax revenue be the highest?

The buyer pays most of a tax if supply is relatively elastic because

Discrimination allocates scarce housing

An effective minimum wage the firms' surplus and the workers' surplus.

Which one of the following statements is false?

In an unregulated housing market with no rent ceiling,

If the supply of a good is perfectly elastic,then a tax on the good will be paid

Daisy and Donald live in a community with rent ceilings.Both are looking for an apartment to rent.Daisy has a job paying $10 per hour and Donald has a job paying $8 per hour.Both value an apartment equally.What is the most likely outcome?

A lottery allocates housing to those

If the price of a good is not affected by a tax,then

If the penalty on sellers of an illegal good is less than the penalty on buyers of an illegal good,then supply of the good will by demand and the price of the good will .

In an unregulated housing market with no rent ceiling,

An illegal market in which the equilibrium price exceeds the price ceiling is

Use the table below to answer the following questions. Table 6.3.1 -Refer to Table 6.3.1.Suppose a sales tax of $2 a unit is imposed on the good described in the table.The buyers' share of the tax is

Use the figure below to answer the following questions. Figure 6.3.3 -Refer to Figure 6.3.3.Suppose a tax of $1 is imposed.In which market would tax revenue be the lowest?

Use the table below to answer the following questions. Table 6.2.2 -Table 6.2.2 gives the labour demand and labour supply schedules for low-skilled labour.What is the level of unemployment in millions of hours if the minimum wage is set at $17 per hour?

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Global Markets in Action

Utility and Demand

Possibilities, preferences, and Choices

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Filters

Exam 6: Government Actions in Markets

If the demand for a good is perfectly elastic,then a tax on the good will be paid

A price ceiling set below the equilibrium price will result in

Use the figure below to answer the following questions. Figure 6.2.1 -Refer to Figure 6.2.1.What is the equilibrium wage rate per hour in an unregulated market?

Use the figure below to answer the following questions. Figure 6.3.3 -Refer to Figure 6.3.3.Suppose a tax of $1 is imposed.In which market would tax revenue be the highest?

The buyer pays most of a tax if supply is relatively elastic because

Discrimination allocates scarce housing

An effective minimum wage ________ the firms' surplus and ________ the workers' surplus.

Which one of the following statements is false?

In an unregulated housing market with no rent ceiling,

If the supply of a good is perfectly elastic,then a tax on the good will be paid

Daisy and Donald live in a community with rent ceilings.Both are looking for an apartment to rent.Daisy has a job paying $10 per hour and Donald has a job paying $8 per hour.Both value an apartment equally.What is the most likely outcome?

A lottery allocates housing to those

If the price of a good is not affected by a tax,then

If the penalty on sellers of an illegal good is less than the penalty on buyers of an illegal good,then supply of the good will ________ by ________ demand and the price of the good will ________.

In an unregulated housing market with no rent ceiling,

An illegal market in which the equilibrium price exceeds the price ceiling is

Use the table below to answer the following questions. Table 6.3.1 -Refer to Table 6.3.1.Suppose a sales tax of $2 a unit is imposed on the good described in the table.The buyers' share of the tax is

Use the figure below to answer the following questions. Figure 6.3.3 -Refer to Figure 6.3.3.Suppose a tax of $1 is imposed.In which market would tax revenue be the lowest?

Use the table below to answer the following questions. Table 6.2.2 -Table 6.2.2 gives the labour demand and labour supply schedules for low-skilled labour.What is the level of unemployment in millions of hours if the minimum wage is set at $17 per hour?

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Global Markets in Action

Utility and Demand

Possibilities, preferences, and Choices

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Filters

An effective minimum wage the firms' surplus and the workers' surplus.

If the penalty on sellers of an illegal good is less than the penalty on buyers of an illegal good,then supply of the good will by demand and the price of the good will .