Question 1

When a tax is placed on the buyer of a product,what is the result

Accepted Answer

A) Buyers pay more and sellers receive less. 
B) Buyers pay less and sellers receive less. 
C) Buyers pay more and sellers receive more. 
D) Buyers pay less and sellers receive more. 
A) Buyers pay more and sellers receive less. 
B) Buyers pay less and sellers receive less. 
C) Buyers pay more and sellers receive more. 
D) Buyers pay less and sellers receive more.

Question 2

What have researchers found will happen after a 10 percent increase in the minimum wage

Accepted Answer

A) Teen employment falls by 1 to 3 percent. 
B) For young adults aged 20-25 employment falls by 1 to 3 percent. 
C) Teen employment rises by 1 to 3 percent. 
D) For young adults aged 20-25 employment rises by 1 to 3 percent. 
A) Teen employment falls by 1 to 3 percent. 
B) For young adults aged 20-25 employment falls by 1 to 3 percent. 
C) Teen employment rises by 1 to 3 percent. 
D) For young adults aged 20-25 employment rises by 1 to 3 percent.

Question 3

Why do policymakers choose to enact price controls in a market

Accepted Answer

A) They believe the market's outcome to be unfair. 
B) Enacting price controls will directly increase tax revenues. 
C) They are required by law to improve market conditions. 
D) They believe that the market system is inefficient and their actions will improve efficiency. 
A) They believe the market's outcome to be unfair. 
B) Enacting price controls will directly increase tax revenues. 
C) They are required by law to improve market conditions. 
D) They believe that the market system is inefficient and their actions will improve efficiency.

Question 4

How will a $4.00 per unit tax placed on the sellers of mailboxes shift the supply curve

Accepted Answer

A) left (upward) by exactly $4.00 
B) left (upward) by $2.00 
C) right (downward) by exactly $4.00 
D) right (downward) by $2.00 
A) left (upward) by exactly $4.00 
B) left (upward) by $2.00 
C) right (downward) by exactly $4.00 
D) right (downward) by $2.00

Question 5

Using the graph shown below,answer the following questions.
a.What was the equilibrium price and quantity in this market before the tax
b.What is the amount of the tax
c.How much of the tax will the buyers pay
d.How much of the tax will the sellers pay
e.How much will the buyer pay for the product after the tax is imposed
f.How much will the seller receive after the tax is imposed
g.As a result of the tax,what has happened to the level of market activity

Accepted Answer

a. Equilibrium price was $8 and equilibr

Question 6

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

Accepted Answer

A) True 
 B)False

Question 7

Figure 6-12
  
-Refer to Figure 6-12.What is the equilibrium price and quantity before the tax is imposed

Accepted Answer

A) P₀ and Q₀ 
B) P₁ and Q₁ 
C) P₁ and Q₀ 
D) P₀ and Q₁ 
A) P₀ and Q₀ 
B) P₁ and Q₁ 
C) P₁ and Q₀ 
D) P₀ and Q₁

Question 8

What methods are available to raise revenue by levels of governments

Accepted Answer

A) All governments, federal, provincial, and local, rely on taxes to raise revenue for public purposes. 
B) Federal and provincial governments use taxes to raise revenue, but local governments use borrowing. 
C) Federal and local governments use taxes to raise revenue, but provincial governments use borrowing. 
D) Provincial and local governments use taxes to raise revenue, but the federal government uses borrowing. 
A) All governments, federal, provincial, and local, rely on taxes to raise revenue for public purposes. 
B) Federal and provincial governments use taxes to raise revenue, but local governments use borrowing. 
C) Federal and local governments use taxes to raise revenue, but provincial governments use borrowing. 
D) Provincial and local governments use taxes to raise revenue, but the federal government uses borrowing.

Question 9

Where is the initial effect of a tax on the buyers of a good

Accepted Answer

A) on the supply of that good 
B) on the demand for that good 
C) on the equilibrium quantity of the good 
D) on the equilibrium price of the good 
A) on the supply of that good 
B) on the demand for that good 
C) on the equilibrium quantity of the good 
D) on the equilibrium price of the good

Question 10

Compared to Canada,what caused the shortage of gasoline in the United States in the 1970s

Accepted Answer

A) a sharp increase in the demand for gasoline needed for the Vietnam war 
B) government regulation in the form of a price ceiling 
C) an indifference among U.S.consumers toward conservation 
D) the lack of alternative sources of crude oil 
A) a sharp increase in the demand for gasoline needed for the Vietnam war 
B) government regulation in the form of a price ceiling 
C) an indifference among U.S.consumers toward conservation 
D) the lack of alternative sources of crude oil

Question 11

a.Using the graph shown,analyze the effect a $300 price ceiling would have on the market for 10-speed bicycles.Would this be a binding price ceiling
b.Using the graph shown,analyze the effect a $700 price floor would have on this market.Would this be a binding price floor
c.Why would policymakers choose to impose a price ceiling or price floor

Accepted Answer

a.For this example,a $300 price ceiling

Question 12

Do minimum-wage laws in Canada vary by provinces

Accepted Answer

A) No.All provinces have legislation that establishes the same minimum wage as the federal law. 
B) Yes.All provinces have legislation that establishes different minimum-wage rates. 
C) Yes.The federal law has set lower minimum-wage rates in all territories. 
D) No.The federal law has set higher minimum-wage rates for inexperienced workers across all provinces. 
A) No.All provinces have legislation that establishes the same minimum wage as the federal law. 
B) Yes.All provinces have legislation that establishes different minimum-wage rates. 
C) Yes.The federal law has set lower minimum-wage rates in all territories. 
D) No.The federal law has set higher minimum-wage rates for inexperienced workers across all provinces.

Question 13

What will a binding price ceiling make it necessary to do

Accepted Answer

A) supply more of the product 
B) develop a way of rationing the product, because there will be a shortage 
C) develop a better marketing plan, because there will be a surplus 
D) increase demand for the product 
A) supply more of the product 
B) develop a way of rationing the product, because there will be a shortage 
C) develop a better marketing plan, because there will be a surplus 
D) increase demand for the product

Question 14

Market demand is given as QD = 300 - P.Market supply is given as QS = 2P.Which legally imposed price would constitute a binding price floor

Accepted Answer

A) $50 
B) $75 
C) $100 
D) $125 
A) $50 
B) $75 
C) $100 
D) $125

Question 15

Any time a tax is placed on the buyers of a product,what will it do to the equilibrium price (to buyers) and quantity

Accepted Answer

A) It will reduce the equilibrium price and increase the equilibrium quantity of that product. 
B) It will reduce the equilibrium price and equilibrium quantity of that product. 
C) It will increase the equilibrium price and equilibrium quantity of that product. 
D) It will increase the equilibrium price and reduce the equilibrium quantity of that product. 
A) It will reduce the equilibrium price and increase the equilibrium quantity of that product. 
B) It will reduce the equilibrium price and equilibrium quantity of that product. 
C) It will increase the equilibrium price and equilibrium quantity of that product. 
D) It will increase the equilibrium price and reduce the equilibrium quantity of that product.

Question 16

After OPEC raised the price of crude oil in world markets,long gas lines in the United States were caused by the higher prices of oil and gas.

Accepted Answer

A) True 
 B)False

Question 17

Figure 6-2
  
-Refer to Figure 6-2.At which price would there be a binding price ceiling

Accepted Answer

A) $8.00 
B) $10.00 
C) $12.00 
D) $14.00 
A) $8.00 
B) $10.00 
C) $12.00 
D) $14.00

Question 18

What is the NOT a likely to result from the imposition of a price ceiling in the market for rental cars

Accepted Answer

A) free unlimited mileage given to people as an incentive to rent a car 
B) poor engine maintenance in rental cars 
C) an accumulation of dirt in the interior of rental cars 
D) slow replacement of old rental cars with new ones 
A) free unlimited mileage given to people as an incentive to rent a car 
B) poor engine maintenance in rental cars 
C) an accumulation of dirt in the interior of rental cars 
D) slow replacement of old rental cars with new ones

Question 19

A tax on sellers shifts the supply curve upward by exactly the size of the tax.

Accepted Answer

A) True 
 B)False

Question 20

Market demand is given as QD = 210 - 5P.Market supply is given as QS = 2P.Which legally imposed price would constitute a binding price ceiling

Accepted Answer

A) $25 
B) $35 
C) $45 
D) $55 
A) $25 
B) $35 
C) $45 
D) $55

When a tax is placed on the buyer of a product,what is the result

What have researchers found will happen after a 10 percent increase in the minimum wage

Why do policymakers choose to enact price controls in a market

How will a $4.00 per unit tax placed on the sellers of mailboxes shift the supply curve

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

Figure 6-12 -Refer to Figure 6-12.What is the equilibrium price and quantity before the tax is imposed

What methods are available to raise revenue by levels of governments

Where is the initial effect of a tax on the buyers of a good

Compared to Canada,what caused the shortage of gasoline in the United States in the 1970s

Do minimum-wage laws in Canada vary by provinces

What will a binding price ceiling make it necessary to do

Market demand is given as Q_D= 300 - P.Market supply is given as Q_S= 2P.Which legally imposed price would constitute a binding price floor

Any time a tax is placed on the buyers of a product,what will it do to the equilibrium price (to buyers) and quantity

After OPEC raised the price of crude oil in world markets,long gas lines in the United States were caused by the higher prices of oil and gas.

Figure 6-2 -Refer to Figure 6-2.At which price would there be a binding price ceiling

What is the NOT a likely to result from the imposition of a price ceiling in the market for rental cars

A tax on sellers shifts the supply curve upward by exactly the size of the tax.

Market demand is given as Q_D= 210 - 5P.Market supply is given as Q_S= 2P.Which legally imposed price would constitute a binding price ceiling

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 Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Filters

Exam 6: Supply, demand, and Government Policies

When a tax is placed on the buyer of a product,what is the result

What have researchers found will happen after a 10 percent increase in the minimum wage

Why do policymakers choose to enact price controls in a market

How will a $4.00 per unit tax placed on the sellers of mailboxes shift the supply curve

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

Figure 6-12 -Refer to Figure 6-12.What is the equilibrium price and quantity before the tax is imposed

What methods are available to raise revenue by levels of governments

Where is the initial effect of a tax on the buyers of a good

Compared to Canada,what caused the shortage of gasoline in the United States in the 1970s

Do minimum-wage laws in Canada vary by provinces

What will a binding price ceiling make it necessary to do

Market demand is given as QD = 300 - P.Market supply is given as QS = 2P.Which legally imposed price would constitute a binding price floor

Any time a tax is placed on the buyers of a product,what will it do to the equilibrium price (to buyers) and quantity

After OPEC raised the price of crude oil in world markets,long gas lines in the United States were caused by the higher prices of oil and gas.

Figure 6-2 -Refer to Figure 6-2.At which price would there be a binding price ceiling

What is the NOT a likely to result from the imposition of a price ceiling in the market for rental cars

A tax on sellers shifts the supply curve upward by exactly the size of the tax.

Market demand is given as QD = 210 - 5P.Market supply is given as QS = 2P.Which legally imposed price would constitute a binding price ceiling

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 Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Filters

Market demand is given as Q_D= 300 - P.Market supply is given as Q_S= 2P.Which legally imposed price would constitute a binding price floor

Market demand is given as Q_D= 210 - 5P.Market supply is given as Q_S= 2P.Which legally imposed price would constitute a binding price ceiling