Question 1

As a rationing mechanism,discrimination according to seller bias is

Accepted Answer

A)  efficient and fair. 
B)  efficient, but potentially unfair. 
C)  inefficient, but fair. 
D)  inefficient and potentially unfair. 
A)  efficient and fair. 
B)  efficient, but potentially unfair. 
C)  inefficient, but fair. 
D)  inefficient and potentially unfair.

Question 2

How is the burden of a tax divided?
(i)When the tax is levied on the sellers,the sellers bear a higher proportion of the tax burden.
(ii)When the tax is levied on the buyers,the buyers bear a higher proportion of the tax burden.
(iii)Regardless of whether the tax is levied on the buyers or the sellers,the buyers and sellers bear an equal proportion of the tax burden.
(iv)Regardless of whether the tax is levied on the buyers or the sellers,the buyers and sellers bear some proportion of the tax burden.

Accepted Answer

A)  (i) and (ii) only 
B)  (iv) only 
C)  (i), (ii), and (iii) only 
D)  (i), (ii), and (iv) only 
A)  (i) and (ii) only 
B)  (iv) only 
C)  (i), (ii), and (iii) only 
D)  (i), (ii), and (iv) only

Question 3

A binding price ceiling
(i)causes a surplus.
(ii)causes a shortage.
(iii)is set at a price above the equilibrium price.
(iv)is set at a price below the equilibrium price.

Accepted Answer

A)  (ii) only 
B)  (iv) only 
C)  (i) and (iii) only 
D)  (ii) and (iv) only 
A)  (ii) only 
B)  (iv) only 
C)  (i) and (iii) only 
D)  (ii) and (iv) only

Question 4

Price ceilings are typically imposed to benefit buyers.

Accepted Answer

A) True 
 B)False

Question 5

Figure 6-13
  
-Refer to Figure 6-13.In this market,a minimum wage of $2.75 creates a labor

Accepted Answer

A)  shortage of 2,250 workers. 
B)  shortage of 4,500 workers. 
C)  surplus of 2,250 workers. 
D)  neither a labor shortage nor surplus. 
A)  shortage of 2,250 workers. 
B)  shortage of 4,500 workers. 
C)  surplus of 2,250 workers. 
D)  neither a labor shortage nor surplus.

Question 6

Figure 6-9
  
-Refer to Figure 6-9.At which price would a price floor be binding?

Accepted Answer

A)  $6 
B)  $5 
C)  $4 
D)  $3 
A)  $6 
B)  $5 
C)  $4 
D)  $3

Question 7

Figure 6-24
Suppose the government imposes a $2 on this market.
  
-Refer to Figure 6-24.Suppose D1 represents the demand curve for gasoline in both the short run and long run,S1 represents the supply curve for gasoline in the short run,and S2 represents the supply curve for gasoline in the long run.After the imposition of the $2,the price paid by buyers will be

Accepted Answer

A)  higher in the long run than in the short run. 
B)  higher in the short run than in the long run. 
C)  equivalent in the short run and the long run. 
D)  unable to be determined without additional information. 
A)  higher in the long run than in the short run. 
B)  higher in the short run than in the long run. 
C)  equivalent in the short run and the long run. 
D)  unable to be determined without additional information.

Question 8

The minimum wage is an example of a

Accepted Answer

A)  price ceiling. 
B)  price floor. 
C)  wage subsidy. 
D)  tax. 
A)  price ceiling. 
B)  price floor. 
C)  wage subsidy. 
D)  tax.

Question 9

Consider the market for watermelons.Buyers

Accepted Answer

A)  and sellers would lobby for a price ceiling. 
B)  and sellers would lobby for a price floor. 
C)  would lobby for a price ceiling, whereas sellers would lobby for a price floor. 
D)  would lobby for a price floor, whereas sellers would lobby for a price ceiling. 
A)  and sellers would lobby for a price ceiling. 
B)  and sellers would lobby for a price floor. 
C)  would lobby for a price ceiling, whereas sellers would lobby for a price floor. 
D)  would lobby for a price floor, whereas sellers would lobby for a price ceiling.

Question 10

The quantity sold in a market will increase if the government

Accepted Answer

A)  decreases a binding price floor in that market. 
B)  decreases a binding price ceiling in that market. 
C)  increases a tax on the good sold in that market. 
D)  More than one of the above is correct. 
A)  decreases a binding price floor in that market. 
B)  decreases a binding price ceiling in that market. 
C)  increases a tax on the good sold in that market. 
D)  More than one of the above is correct.

Question 11

Figure 6-9
  
-Refer to Figure 6-9.A price ceiling set at

Accepted Answer

A)  $4 will be binding and will result in a shortage of 3 units. 
B)  $4 will be binding and will result in a shortage of 6 units. 
C)  $7 will be binding and will result in a surplus of 6 units. 
D)  $7 will be binding and will result in a surplus of 12 units. 
A)  $4 will be binding and will result in a shortage of 3 units. 
B)  $4 will be binding and will result in a shortage of 6 units. 
C)  $7 will be binding and will result in a surplus of 6 units. 
D)  $7 will be binding and will result in a surplus of 12 units.

Question 12

The long-run effects of rent controls are a good illustration of the principle that

Accepted Answer

A)  society faces a short-run tradeoff between unemployment and inflation. 
B)  the cost of something is what you give up to get it. 
C)  people respond to incentives. 
D)  government can sometimes improve on market outcomes. 
A)  society faces a short-run tradeoff between unemployment and inflation. 
B)  the cost of something is what you give up to get it. 
C)  people respond to incentives. 
D)  government can sometimes improve on market outcomes.

Question 13

Figure 6-20
  
-Refer to Figure 6-20.What is the amount of the tax per unit?

Accepted Answer

A)  $8 
B)  $6 
C)  $4 
D)  $2 
A)  $8 
B)  $6 
C)  $4 
D)  $2

Question 14

In a competitive market free of government regulation,

Accepted Answer

A)  price adjusts until quantity demanded is greater than quantity supplied. 
B)  price adjusts until quantity demanded is less than quantity supplied. 
C)  price adjusts until quantity demanded equals quantity supplied. 
D)  supply adjusts to meet demand at every price. 
A)  price adjusts until quantity demanded is greater than quantity supplied. 
B)  price adjusts until quantity demanded is less than quantity supplied. 
C)  price adjusts until quantity demanded equals quantity supplied. 
D)  supply adjusts to meet demand at every price.

Question 15

If a binding price floor is imposed on the video game market,then

Accepted Answer

A)  the demand for video games will decrease. 
B)  the supply of video games will increase. 
C)  a surplus of video games will develop. 
D)  All of the above are correct. 
A)  the demand for video games will decrease. 
B)  the supply of video games will increase. 
C)  a surplus of video games will develop. 
D)  All of the above are correct.

Question 16

A tax imposed on the sellers of a good will raise the

Accepted Answer

A)  price paid by buyers and lower the equilibrium quantity. 
B)  price paid by buyers and raise the equilibrium quantity. 
C)  effective price received by sellers and lower the equilibrium quantity. 
D)  effective price received by sellers and raise the equilibrium quantity. 
A)  price paid by buyers and lower the equilibrium quantity. 
B)  price paid by buyers and raise the equilibrium quantity. 
C)  effective price received by sellers and lower the equilibrium quantity. 
D)  effective price received by sellers and raise the equilibrium quantity.

Question 17

The quantity sold in a market will increase if the government

Accepted Answer

A)  decreases a binding price floor in that market. 
B)  increases a binding price ceiling in that market. 
C)  decreases a tax on the good sold in that market. 
D)  More than one of the above is correct. 
A)  decreases a binding price floor in that market. 
B)  increases a binding price ceiling in that market. 
C)  decreases a tax on the good sold in that market. 
D)  More than one of the above is correct.

Question 18

Who bears the majority of a tax burden depends on the relative elasticity of supply and demand.

Accepted Answer

A) True 
 B)False

Question 19

A price floor set above the equilibrium price causes a surplus in the market.

Accepted Answer

A) True 
 B)False

Question 20

Suppose that the demand for picture frames is highly inelastic,and the supply of picture frames is highly elastic.A tax of $1 per frame levied on picture frames will increase the price paid by buyers of picture frames by

Accepted Answer

A)  less than $0.50. 
B)  $0.50. 
C)  between $0.50 and $1. 
D)  $1. 
A)  less than $0.50. 
B)  $0.50. 
C)  between $0.50 and $1. 
D)  $1.

As a rationing mechanism,discrimination according to seller bias is

A binding price ceiling (i)causes a surplus. (ii)causes a shortage. (iii)is set at a price above the equilibrium price. (iv)is set at a price below the equilibrium price.

Price ceilings are typically imposed to benefit buyers.

Figure 6-13 -Refer to Figure 6-13.In this market,a minimum wage of $2.75 creates a labor

Figure 6-9 -Refer to Figure 6-9.At which price would a price floor be binding?

The minimum wage is an example of a

Consider the market for watermelons.Buyers

The quantity sold in a market will increase if the government

Figure 6-9 -Refer to Figure 6-9.A price ceiling set at

The long-run effects of rent controls are a good illustration of the principle that

Figure 6-20 -Refer to Figure 6-20.What is the amount of the tax per unit?

In a competitive market free of government regulation,

If a binding price floor is imposed on the video game market,then

A tax imposed on the sellers of a good will raise the

The quantity sold in a market will increase if the government

Who bears the majority of a tax burden depends on the relative elasticity of supply and demand.

A price floor set above the equilibrium price causes a surplus in the market.

Suppose that the demand for picture frames is highly inelastic,and the supply of picture frames is highly elastic.A tax of $1 per frame levied on picture frames will increase the price paid by buyers of picture frames by

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.

Application: 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 Market For the Factors of Production.

Earnings and Discrimination.

Income Inequality and Poverty.

The Theory of Consumer Choice.

Frontiers in Microeconomics.

Filters

Exam 6: Supply, Demand, And Government Policies.

As a rationing mechanism,discrimination according to seller bias is

A binding price ceiling (i)causes a surplus. (ii)causes a shortage. (iii)is set at a price above the equilibrium price. (iv)is set at a price below the equilibrium price.

Price ceilings are typically imposed to benefit buyers.

Figure 6-13 -Refer to Figure 6-13.In this market,a minimum wage of $2.75 creates a labor

Figure 6-9 -Refer to Figure 6-9.At which price would a price floor be binding?

The minimum wage is an example of a

Consider the market for watermelons.Buyers

The quantity sold in a market will increase if the government

Figure 6-9 -Refer to Figure 6-9.A price ceiling set at

The long-run effects of rent controls are a good illustration of the principle that

Figure 6-20 -Refer to Figure 6-20.What is the amount of the tax per unit?

In a competitive market free of government regulation,

If a binding price floor is imposed on the video game market,then

A tax imposed on the sellers of a good will raise the

The quantity sold in a market will increase if the government

Who bears the majority of a tax burden depends on the relative elasticity of supply and demand.

A price floor set above the equilibrium price causes a surplus in the market.

Suppose that the demand for picture frames is highly inelastic,and the supply of picture frames is highly elastic.A tax of $1 per frame levied on picture frames will increase the price paid by buyers of picture frames by

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.

Application: 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 Market For the Factors of Production.

Earnings and Discrimination.

Income Inequality and Poverty.

The Theory of Consumer Choice.

Frontiers in Microeconomics.

Filters