Exam 5: Markets in Motion and Price Controls

If both market demand and supply decrease simultaneously,then equilibrium quantity will (be)____ and equilibrium price will (be)____.

After a binding price floor becomes effective,a

If a price ceiling is a binding constraint on a market,then

If a price ceiling is not binding,then

One common example of a price ceiling is rent control.

Either a price floor or a price ceiling will result in a smaller quantity exchanged than if the price was at its equilibrium level.

Exhibit 5-2 Refer to Exhibit 5-2.The movement from ____ is consistent with an increase in supply.

In January,2,500 quarts of ice cream are sold in Boston at $2 per quart.In February,3,000 quarts are sold at $2.50 a quart.This change in the price and quantity sold of ice cream may have been caused by:

Say that the equilibrium price of natural gas would be $5 per thousand cubic feet,but there is a price floor imposed at $7 per thousand cubic feet.That price floor is then lowered to $5 per thousand cubic feet.As a result,

For a normal good,if incomes rise,we would expect that the equilibrium price will increase and that the equilibrium quantity will increase.

Whenever there is a surplus at a particular price,the quantity sold at that price will equal:

Beach resorts raise their prices during the summer months and yet more people book rooms at those times.Is this a violation of the law of demand?

The imposition of a binding price floor on a market causes quantity demanded to be

A price ceiling set below the equilibrium price is binding.

To be binding,a price ceiling must be set above the equilibrium price.

Exhibit 5-6 Refer to Exhibit 5-6.According to the data in the above table,the equilibrium price of gasoline is:

If input prices rose and production technology improved at the same time,as a result:

Which of the following is likely to result in a lower equilibrium price?

Ceteris paribus,if the market demand for a product increases,then equilibrium quantity will (be)____ and equilibrium price will (be)____.

A price floor set above the equilibrium price is not binding.