Question 1

A price floor set above the equilibrium price is binding.

Accepted Answer

A) True 
 B)False

Question 2

Rent control

Accepted Answer

A) serves as an example of how a social problem can be alleviated or even solved by government policies. 
B) serves as an example of a price ceiling. 
C) is regarded by most economists as an efficient way of helping the poor. 
D) is the most efficient way to allocate scarce housing resources. 
A) serves as an example of how a social problem can be alleviated or even solved by government policies. 
B) serves as an example of a price ceiling. 
C) is regarded by most economists as an efficient way of helping the poor. 
D) is the most efficient way to allocate scarce housing resources.

Question 3

Which of the following is not a rationing mechanism used by landlords in cities with rent control?

Accepted Answer

A) Waiting lists 
B) Race 
C) Price 
D) Bribes 
A) Waiting lists 
B) Race 
C) Price 
D) Bribes

Question 4

When a binding price floor is imposed on a market for a good, some people who want to sell the good cannot do so.

Accepted Answer

A) True 
 B)False

Question 5

Policymakers use taxes to raise revenue for public purposes and to influence market outcomes.

Accepted Answer

A) True 
 B)False

Question 6

When a tax is placed on the sellers of a product, buyers pay

Accepted Answer

A) more, and sellers receive more than they did before the tax. 
B) more, and sellers receive less than they did before the tax. 
C) less, and sellers receive more than they did before the tax. 
D) less, and sellers receive less than they did before the tax. 
A) more, and sellers receive more than they did before the tax. 
B) more, and sellers receive less than they did before the tax. 
C) less, and sellers receive more than they did before the tax. 
D) less, and sellers receive less than they did before the tax.

Question 7

Using a supply and demand diagram, show a labor market with a binding minimum wage. Use the diagram to show those who are helped by the minimum wage and those who are hurt by the minimum wage.

Accepted Answer

a.
For this example, a $300 price ceilin

Question 8

Figure 6-20
   ​
-Refer to Figure 6-20. Suppose a $4 per-unit tax is imposed on the sellers of this good. How many units of this good will be sold after the tax is imposed?

Accepted Answer

With a $4 per-unit t

Question 9

Figure 6-12
   ​
​
-Refer to Figure 6-12. Suppose a tax of $84 per unit is imposed on this market. Which of the following is correct?

Accepted Answer

A) Buyers and sellers will share the burden of the tax equally. 
B) Sellers will bear more of the burden of the tax than buyers will. 
C) Buyers will bear more of the burden of the tax than sellers will. 
D) There is no tax burden. 
A) Buyers and sellers will share the burden of the tax equally. 
B) Sellers will bear more of the burden of the tax than buyers will. 
C) Buyers will bear more of the burden of the tax than sellers will. 
D) There is no tax burden.

Question 10

If the equilibrium wage is $4 per hour and the minimum wage is $5.15 per hour, then a shortage of labor will exist.

Accepted Answer

A) True 
 B)False

Question 11

The burden of a luxury tax usually falls

Accepted Answer

A) more on the rich than on the middle class. 
B) more on the poor than on the rich. 
C) more on the middle class than on the rich. 
D) equally on the rich, the middle class, and the poor. 
A) more on the rich than on the middle class. 
B) more on the poor than on the rich. 
C) more on the middle class than on the rich. 
D) equally on the rich, the middle class, and the poor.

Question 12

A binding price ceiling may not help all consumers, but it does not hurt any consumers.

Accepted Answer

A) True 
 B)False

Question 13

Regardless of whether a tax is levied on sellers or buyers, taxes discourage market activity.

Accepted Answer

A) True 
 B)False

Question 14

Minimum-wage laws are precise policy instruments that can specifically target workers whose family incomes are low.

Accepted Answer

A) True 
 B)False

Question 15

Figure 6-14
   ​
-Refer to Figure 6-14. The buyers will bear the highest share of the tax burden compared to sellers if the demand is

Accepted Answer

A) D1, and the supply is S1. 
B) D2, and the supply is S1. 
C) D1, and the supply is S2. 
D) D2, and the supply is S2. 
A) D1, and the supply is S1. 
B) D2, and the supply is S1. 
C) D1, and the supply is S2. 
D) D2, and the supply is S2.

Question 16

Scenario 6-1
Suppose that demand in the market for good X is given by the equation
 $$Q ^ { D } = 30 - P$$ and that supply in the market for good X is given by the equation
 $$Q ^ { S } = 2 P$$
-Refer to Scenario 6-1. What are the equilibrium price and quantity in the market for good X?

Accepted Answer

The equilibrium pric

Question 17

Prices are inefficient rationing devices.

Accepted Answer

A) True 
 B)False

Question 18

The true burden of a payroll tax has nothing to do with the percentage of the tax that employers are required to pay.

Accepted Answer

A) True 
 B)False

Question 19

Rent control may lead to lower rents for those who find housing, but the quality of the housing may also be lower.

Accepted Answer

A) True 
 B)False

Question 20

Workers with high skills and much experience are not typically affected by the minimum wage.

Accepted Answer

A) True 
 B)False

Exam 6: Supply, Demand, and Government Policies

A price floor set above the equilibrium price is binding.

Rent control

Which of the following is not a rationing mechanism used by landlords in cities with rent control?

When a binding price floor is imposed on a market for a good, some people who want to sell the good cannot do so.

Policymakers use taxes to raise revenue for public purposes and to influence market outcomes.

When a tax is placed on the sellers of a product, buyers pay

Using a supply and demand diagram, show a labor market with a binding minimum wage. Use the diagram to show those who are helped by the minimum wage and those who are hurt by the minimum wage.

Figure 6-20 ​ -Refer to Figure 6-20. Suppose a $4 per-unit tax is imposed on the sellers of this good. How many units of this good will be sold after the tax is imposed?

Figure 6-12 ​ ​ -Refer to Figure 6-12. Suppose a tax of $84 per unit is imposed on this market. Which of the following is correct?

If the equilibrium wage is $4 per hour and the minimum wage is $5.15 per hour, then a shortage of labor will exist.

The burden of a luxury tax usually falls

A binding price ceiling may not help all consumers, but it does not hurt any consumers.

Regardless of whether a tax is levied on sellers or buyers, taxes discourage market activity.

Minimum-wage laws are precise policy instruments that can specifically target workers whose family incomes are low.

Figure 6-14 ​ -Refer to Figure 6-14. The buyers will bear the highest share of the tax burden compared to sellers if the demand is

Prices are inefficient rationing devices.

The true burden of a payroll tax has nothing to do with the percentage of the tax that employers are required to pay.

Rent control may lead to lower rents for those who find housing, but the quality of the housing may also be lower.

Workers with high skills and much experience are not typically affected by the minimum wage.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Consumers, Producers, and the Efficiency of Markets

Applications: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters

Figure 6-20 -Refer to Figure 6-20. Suppose a $4 per-unit tax is imposed on the sellers of this good. How many units of this good will be sold after the tax is imposed?

Figure 6-12 -Refer to Figure 6-12. Suppose a tax of $84 per unit is imposed on this market. Which of the following is correct?

Figure 6-14 -Refer to Figure 6-14. The buyers will bear the highest share of the tax burden compared to sellers if the demand is