Exam 6: Supply, Demand, and Government Policies

Scenario 6-2 Suppose demand for a product is given by the equation and supply for the product is given by the equation -Refer to Scenario 6-2. Suppose the government sets a price ceiling at $17 for this product. Is this price ceiling binding, and what will be the size of the shortage/surplus in this market?

Which of the following is correct?

Figure 6-27 This figure shows the market demand and market supply curves for good Z. -Refer to Figure 6-27. Suppose a tax of $6 per unit is imposed on this market. Which of the following is correct?

When a tax is placed on the sellers of cell phones, the size of the cell phone market

Rent-control laws dictate a minimum rent that landlords may charge tenants.

Studies of the effects of the minimum wage typically find that a 10 percent increase in the minimum wage depresses teenage employment by about

If a price ceiling of $1.50 per gallon is imposed on gasoline, and the market equilibrium price is $2, then the price ceiling is a binding constraint on the market.

A surplus results when a

Figure 6-6 -Refer to Figure 6-6. If the government imposes a price ceiling of $6 on this market, then there will be

If the government passes a law requiring sellers of mopeds to send $200 to the government for every moped they sell, then

The minimum wage, if it is binding, raises the incomes of

Figure 6-7 -Refer to Figure 6-7. Suppose a price floor of $8 is imposed on this market. As a result,

If a tax is imposed on the sellers of a product, then the tax burden will fall entirely on the sellers.

Suppose the government imposes a 20-cent tax on the sellers of artificially-sweetened beverages. The tax would shift

Rent control

Table 6-2 -Refer to Table 6-2. A price ceiling set at $20 will

When a tax is placed on the buyers of a product, the

Figure 6-20 -Refer to Figure 6-20. Suppose a tax of $5 per unit is imposed on this market. How much will buyers pay per unit after the tax is imposed?

Figure 6-19 -Refer to Figure 6-19. Suppose a tax of $2 per unit is imposed on this market. How much will sellers receive per unit after the tax is imposed?

Figure 6-7 -Refer to Figure 6-7. For a price ceiling to be binding in this market, it would have to be set at