Exam 7: Government Actions in Markets

-The above figure shows the market for biologists.The government decides to set a minimum wage for biologists of $18 per hour.After this minimum wage is in effect, the deadweight loss equals ________.

A minimum wage that is above the equilibrium wage rate

The deadweight loss from a rent ceiling below the equilibrium rent is smallest when the supply of housing is

-The figure above shows that the government provides a subsidy to the farmers of ________ million.

Is the minimum wage fair?

In a market with a rent ceiling set below the equilibrium rent, the producer and consumer surplus

Will an increase in the minimum wage create more unemployment if the supply and demand for labor are highly elastic or highly inelastic?

-The above figure shows the domestic market for tomatoes.Suppose this market is isolated from global competition and there is a support price set at $16.In this figure, what area equals the producer surplus?

Discuss the inefficiencies created by a price floor.

A minimum wage set above the equilibrium wage

In a competitive labor market, a minimum wage law set above the equilibrium wage rate

-The above figure shows the market for biologists.The government decides to set a minimum wage for biologists of $18 per hour.After this minimum wage is in effect, and taking account of the resources lost in job search, workers' surplus equals ________.

-The demand and supply schedules for pizza are in the table above.If the government sets a maximum legal price of $2 per slice of pizza, then

-The above figure shows the market for 2 bedroom town homes in San Diego.If a rent ceiling is set at $1,000 per month then there is a

Which of the following is true? I∙A price ceiling set above the equilibrium price has no effects. Ii∙A price ceiling set below the equilibrium price creates a surplus. Iii∙A price floor set above the equilibrium price has no effects.

The shortage created by a price ceiling will likely be

A price ceiling

-The above figure shows a labor market with a minimum wage of $8 an hour.The deadweight loss equals the

A price ceiling in the market for fuel oil that is below the equilibrium price will

-The above figure shows the domestic market for wheat.Suppose this market is isolated from global competition and the government intervenes by setting a support price of $15 a ton.To keep the price at this level, the government will ________ million tons of wheat.