Question 1

-In the figure above, imposing a tax on the sellers of the product results in a division in which

Accepted Answer

A)  all of the tax is paid by the buyers. 
B)  all of the tax is paid by the sellers. 
C)  the buyers and sellers pay the same amount. 
D)  neither the buyers nor the sellers pay the tax. 
A)  all of the tax is paid by the buyers. 
B)  all of the tax is paid by the sellers. 
C)  the buyers and sellers pay the same amount. 
D)  neither the buyers nor the sellers pay the tax.

Question 2

-In the table above, what is the level of unemployment (in millions of workers) if the minimum wage is set at $8 per hour?

Accepted Answer

A)  0 
B)  1 
C)  3 
D)  4 
A)  0 
B)  1 
C)  3 
D)  4

Question 3

In general, a fine on selling a product leads to the

Accepted Answer

A)  supply curve shifting rightward. 
B)  supply curve shifting leftward. 
C)  demand curve shifting rightward. 
D)  demand curve shifting leftward. 
A)  supply curve shifting rightward. 
B)  supply curve shifting leftward. 
C)  demand curve shifting rightward. 
D)  demand curve shifting leftward.

Question 4

If supply is perfectly inelastic, a sales tax imposed on sellers is paid by

Accepted Answer

A)  only the buyers. 
B)  only the sellers. 
C)  both the buyers and sellers. 
D)  None of the above answers is correct. 
A)  only the buyers. 
B)  only the sellers. 
C)  both the buyers and sellers. 
D)  None of the above answers is correct.

Question 5

Suppose the government imposes a price ceiling on gasoline that is less than the equilibrium price. As a result

Accepted Answer

A)  the price of gasoline rises to the equilibrium price. 
B)  there is incentive for buyers to undertake search activity. 
C)  the supply of gasoline will increase and the supply curve will shift rightward. 
D)  the demand for gasoline will decrease and the demand curve will shift leftward. 
A)  the price of gasoline rises to the equilibrium price. 
B)  there is incentive for buyers to undertake search activity. 
C)  the supply of gasoline will increase and the supply curve will shift rightward. 
D)  the demand for gasoline will decrease and the demand curve will shift leftward.

Question 6

Which of the following is NOT a potential impact of a rent ceiling set below the equilibrium rent?

Accepted Answer

A)  a surplus 
B)  an increase in search 
C)  a deadweight loss 
D)  None of the above because they are all impacts of a rent ceiling set below the equilibrium rent. 
A)  a surplus 
B)  an increase in search 
C)  a deadweight loss 
D)  None of the above because they are all impacts of a rent ceiling set below the equilibrium rent.

Question 7

-The figure above shows the market for cotton in Georgestan. The government regulates the market with a production quota set at 8 million pounds per year. With the quota in place, the amount of cotton produced in Georgestan is ________ because the marginal social cost of a pound of cotton is ________ the marginal social benefit of a pound of cotton.

Accepted Answer

A)  inefficient; less than 
B)  inefficient; greater than 
C)  efficient; less than 
D)  efficient; equal to 
A)  inefficient; less than 
B)  inefficient; greater than 
C)  efficient; less than 
D)  efficient; equal to

Question 8

-The figure above shows the demand for and supply of rental housing in Smallton. If a rent ceiling is set at $400, there is

Accepted Answer

A)  a shortage of 4,000 units of rental housing. 
B)  a shortage of 2,000 units of rental housing. 
C)  a surplus of 3,000 units of rental housing. 
D)  neither a shortage nor a surplus of rental housing. 
A)  a shortage of 4,000 units of rental housing. 
B)  a shortage of 2,000 units of rental housing. 
C)  a surplus of 3,000 units of rental housing. 
D)  neither a shortage nor a surplus of rental housing.

Question 9

-In the above figure suppose a minimum wage of $8 per hour is imposed. As a result, the quantity of labor supplied is ________ hours and the quantity of labor demanded is ________ hours.

Accepted Answer

A)  3,000; 4,000 
B)  4,000; 4,000 
C)  2,000; 4,000 
D)  4,000; 2,000 
A)  3,000; 4,000 
B)  4,000; 4,000 
C)  2,000; 4,000 
D)  4,000; 2,000

Question 10

-The above figure shows the market for blouses. The government decides to impose the sales tax on sellers, as shown in the figure. The amount of the tax paid by the sellers would be greater than shown in the figure if

Accepted Answer

A)  the demand was more elastic. 
B)  the demand was more inelastic. 
C)  the supply was more elastic. 
D)  Both answers A and C are correct. 
A)  the demand was more elastic. 
B)  the demand was more inelastic. 
C)  the supply was more elastic. 
D)  Both answers A and C are correct.

Question 11

-The government wants to increase its tax revenue and plans to implement an additional sales tax. The government will raise more tax revenue if it taxes a good with an ________ rather than a good with an ________.

Accepted Answer

A)  inelastic demand; elastic demand 
B)  elastic demand; inelastic demand 
C)  elastic supply; inelastic supply 
D)  None of the above answers is correct. 
A)  inelastic demand; elastic demand 
B)  elastic demand; inelastic demand 
C)  elastic supply; inelastic supply 
D)  None of the above answers is correct.

Question 12

-To help pay for the cost of sport related injuries, the government imposes a tax on sellers of all sports equipment. Using the above figure, how much deadweight loss results from this tax on sports equipment?

Accepted Answer

A)  cbd 
B)  ced 
C)  abd 
D)  acd 
A)  cbd 
B)  ced 
C)  abd 
D)  acd

Question 13

Suppose the Chinese government regulates the price of food and forbids firms from setting a higher price. In this case the government is setting a

Accepted Answer

A)  price floor. 
B)  price ceiling. 
C)  quota. 
D)  tax. 
A)  price floor. 
B)  price ceiling. 
C)  quota. 
D)  tax.

Question 14

-In the above figure, CBL is the cost of breaking the law. If it is illegal to sell, but not illegal to buy, then the price per unit will be

Accepted Answer

A)  $500. 
B)  $400. 
C)  $300. 
D)  $200. 
A)  $500. 
B)  $400. 
C)  $300. 
D)  $200.

Question 15

-To help pay for the cost of sport related injuries, the government imposes a tax on sellers of all sports equipment. Referring to the above figure, the area that equals the tax revenue the government raises from this tax on sports equipment is

Accepted Answer

A)  P1P3ed. 
B)  ecd. 
C)  P0P2ca. 
D)  P1P2cb. 
A)  P1P3ed. 
B)  ecd. 
C)  P0P2ca. 
D)  P1P2cb.

Question 16

-The figure above shows the market for milk in Cowland. If a subsidy paid to producers of $1 per gallon of milk is introduced, what is the price that consumers pay?

Accepted Answer

A)  $3.00 a gallon 
B)  between $3.00 and $4.00 per gallon 
C)  $4.00 a gallon 
D)  between $4.00 and $5.00 per gallon 
A)  $3.00 a gallon 
B)  between $3.00 and $4.00 per gallon 
C)  $4.00 a gallon 
D)  between $4.00 and $5.00 per gallon

Question 17

-The figure above shows the market for milk in Cowland. If a subsidy paid to producers of $1 per gallon of milk is introduced, what is the amount, including the subsidy, that suppliers keep per gallon?

Accepted Answer

A)  $3.00 a gallon 
B)  between $3.00 and $4.00 per gallon 
C)  $4.00 a gallon 
D)  between $4.00 and $5.00 per gallon 
A)  $3.00 a gallon 
B)  between $3.00 and $4.00 per gallon 
C)  $4.00 a gallon 
D)  between $4.00 and $5.00 per gallon

Question 18

-In the figure above, originally the apartment rental market is in short-run and long-run equilibrium with a rent of $600 per month. Then the government imposes a rent ceiling of $500 per month. The deadweight loss is borne by

Accepted Answer

A)  the producers only. 
B)  the consumers only. 
C)  all producers and some consumers. 
D)  all consumers and some producers. 
A)  the producers only. 
B)  the consumers only. 
C)  all producers and some consumers. 
D)  all consumers and some producers.

Question 19

Imposing a minimum wage that is above the equilibrium wage rate results in

Accepted Answer

A)  higher job search costs. 
B)  lower unemployment. 
C)  the labor market becoming more efficient. 
D)  equilibrium in the labor market. 
A)  higher job search costs. 
B)  lower unemployment. 
C)  the labor market becoming more efficient. 
D)  equilibrium in the labor market.

Question 20

If the Chinese government sets a price ceiling below the equilibrium price, the result will be to

Accepted Answer

A)  increase total surplus. 
B)  create deadweight loss. 
C)  increase surplus and create deadweight loss. 
D)  eliminate deadweight loss. 
A)  increase total surplus. 
B)  create deadweight loss. 
C)  increase surplus and create deadweight loss. 
D)  eliminate deadweight loss.

-In the figure above, imposing a tax on the sellers of the product results in a division in which

-In the table above, what is the level of unemployment (in millions of workers) if the minimum wage is set at $8 per hour?

In general, a fine on selling a product leads to the

If supply is perfectly inelastic, a sales tax imposed on sellers is paid by

Suppose the government imposes a price ceiling on gasoline that is less than the equilibrium price. As a result

Which of the following is NOT a potential impact of a rent ceiling set below the equilibrium rent?

-The figure above shows the demand for and supply of rental housing in Smallton. If a rent ceiling is set at $400, there is

-In the above figure suppose a minimum wage of $8 per hour is imposed. As a result, the quantity of labor supplied is hours and the quantity of labor demanded is hours.

-The above figure shows the market for blouses. The government decides to impose the sales tax on sellers, as shown in the figure. The amount of the tax paid by the sellers would be greater than shown in the figure if

-The government wants to increase its tax revenue and plans to implement an additional sales tax. The government will raise more tax revenue if it taxes a good with an rather than a good with an .

-To help pay for the cost of sport related injuries, the government imposes a tax on sellers of all sports equipment. Using the above figure, how much deadweight loss results from this tax on sports equipment?

Suppose the Chinese government regulates the price of food and forbids firms from setting a higher price. In this case the government is setting a

-In the above figure, CBL is the cost of breaking the law. If it is illegal to sell, but not illegal to buy, then the price per unit will be

-To help pay for the cost of sport related injuries, the government imposes a tax on sellers of all sports equipment. Referring to the above figure, the area that equals the tax revenue the government raises from this tax on sports equipment is

-The figure above shows the market for milk in Cowland. If a subsidy paid to producers of $1 per gallon of milk is introduced, what is the price that consumers pay?

-The figure above shows the market for milk in Cowland. If a subsidy paid to producers of $1 per gallon of milk is introduced, what is the amount, including the subsidy, that suppliers keep per gallon?

-In the figure above, originally the apartment rental market is in short-run and long-run equilibrium with a rent of $600 per month. Then the government imposes a rent ceiling of $500 per month. The deadweight loss is borne by

Imposing a minimum wage that is above the equilibrium wage rate results in

If the Chinese government sets a price ceiling below the equilibrium price, the result will be to

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Exam 6: Government Actions in Markets

-In the figure above, imposing a tax on the sellers of the product results in a division in which

-In the table above, what is the level of unemployment (in millions of workers) if the minimum wage is set at $8 per hour?

In general, a fine on selling a product leads to the

If supply is perfectly inelastic, a sales tax imposed on sellers is paid by

Suppose the government imposes a price ceiling on gasoline that is less than the equilibrium price. As a result

Which of the following is NOT a potential impact of a rent ceiling set below the equilibrium rent?

-The figure above shows the demand for and supply of rental housing in Smallton. If a rent ceiling is set at $400, there is

-In the above figure suppose a minimum wage of $8 per hour is imposed. As a result, the quantity of labor supplied is ________ hours and the quantity of labor demanded is ________ hours.

-The above figure shows the market for blouses. The government decides to impose the sales tax on sellers, as shown in the figure. The amount of the tax paid by the sellers would be greater than shown in the figure if

-The government wants to increase its tax revenue and plans to implement an additional sales tax. The government will raise more tax revenue if it taxes a good with an ________ rather than a good with an ________.

-To help pay for the cost of sport related injuries, the government imposes a tax on sellers of all sports equipment. Using the above figure, how much deadweight loss results from this tax on sports equipment?

Suppose the Chinese government regulates the price of food and forbids firms from setting a higher price. In this case the government is setting a

-In the above figure, CBL is the cost of breaking the law. If it is illegal to sell, but not illegal to buy, then the price per unit will be

-To help pay for the cost of sport related injuries, the government imposes a tax on sellers of all sports equipment. Referring to the above figure, the area that equals the tax revenue the government raises from this tax on sports equipment is

-The figure above shows the market for milk in Cowland. If a subsidy paid to producers of $1 per gallon of milk is introduced, what is the price that consumers pay?

-The figure above shows the market for milk in Cowland. If a subsidy paid to producers of $1 per gallon of milk is introduced, what is the amount, including the subsidy, that suppliers keep per gallon?

-In the figure above, originally the apartment rental market is in short-run and long-run equilibrium with a rent of $600 per month. Then the government imposes a rent ceiling of $500 per month. The deadweight loss is borne by

Imposing a minimum wage that is above the equilibrium wage rate results in

If the Chinese government sets a price ceiling below the equilibrium price, the result will be to

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

-In the above figure suppose a minimum wage of $8 per hour is imposed. As a result, the quantity of labor supplied is hours and the quantity of labor demanded is hours.

-The government wants to increase its tax revenue and plans to implement an additional sales tax. The government will raise more tax revenue if it taxes a good with an rather than a good with an .