Exam 6: Supply, Demand, and Government Policies

Table 6-3 The following table contains the demand schedule and supply schedule for a market for a particular good.Suppose sellers of the good successfully lobby Congress to impose a price floor $2 above the equilibrium price in this market. -Refer to Table 6-3.Following the imposition of a price floor $2 above the equilibrium price,irate buyers convince Congress to repeal the price floor and to impose a price ceiling $1 below the former price floor.The resulting shortage is

If the government levies a $500 tax per car on sellers of cars,then the price paid by buyers of cars would

An example of a price floor is

When a payroll tax is enacted,

Suppose there is currently a tax of $50 per ticket on airline tickets.Sellers of airline tickets are required to pay the tax to the government.If the tax is reduced from $50 per ticket to $30 per ticket,then

Figure 6-9 -Refer to Figure 6-9.The burden of the tax on sellers is

If a tax is levied on the sellers of a product,then the supply curve

A tax of $1 on buyers always decreases the equilibrium price by $1.

Figure 6-13 The vertical distance between points A and B represents the tax in the market. -Refer to Figure 6-13.The effective price that sellers receive after the tax is imposed is

Figure 6-17 -Refer to Figure 6-17.A price ceiling set at $30 would result in a shortage of 20 units.

The price paid by buyers in a market will increase if the government

Economic policies often have effects that their architects did not intend or anticipate.

Which of the following statements is true?

The minimum wage does not apply to

A legal minimum on the price at which a good can be sold is called a price

To say that a price floor is binding is to say that the price floor

Figure 6-16 Panel (a)Panel (b) Panel (c) -Refer to Figure 6-16.In which market will the tax burden be most equally divided between buyers and sellers?

FICA is an example of a payroll tax,which is a tax on the wages that firms pay their workers.

Figure 6-5 -Refer to Figure 6-5.When a certain price control is imposed on this market,the resulting quantity of the good that is actually bought and sold is such that buyers are willing and able to pay a maximum of P₁ dollars per unit for that quantity and sellers are willing and able to accept a minimum of P₂ dollars per unit for that quantity.If P₁ - P₂ = $3,then the price control in question is

If the government levies a $500 tax per car on buyers of cars,then the price paid by buyers of cars would