Exam 3: Demand and Supply: An Elaboration

-Refer to the graph above to answer this question.What would be the result if an effective price ceiling is set which is $2 different from the equilibrium price and demand increased by 30?

The data shows the market for daycare workers in a particular city: (quantity of workers in hundreds) -Refer to the information above to answer this question.Suppose that after the imposition of a minimum wage of $6.50,a number of new daycare centres opened up increasing the demand for workers by 400.In what way would this market be affected?

-What is a price ceiling? What happens to the relationship between quantity demanded and supplied with an effective price ceiling?

Below is the hypothetical demand for water in a particular country (price per 50 liters): -Refer to the above information to answer this question.Suppose that the present supply of 200 is cut by 80.What effect will this have on the price?

Price floors are often introduced in agricultural markets for which of the following reasons?

The data shows the demand and supply for sugar: quantity of kilograms (in thousand per week) -Refer to the information above to answer this question.What would happen if the government were to establish an effective price floor of $3 per kilogram of sugar?

-Refer to Table 3.3 to answer this question.Suppose that the government introduces an effective price floor that is $0.20 different from the equilibrium price.What will be the result?

-Economic laws are social laws-statements of tendencies,more or less certain,more or less definite.

The data in the table below are for boxes of fresh shrimp. a)Before the tax,what is the equilibrium price and quantity? b)Fill in the Quantity Supplied After Tax column assuming that a $10 per unit excise tax is put on the product. c)What is the new equilibrium price and quantity? d)What portion of the $10 per unit tax is paid by the seller and what portion is paid by the consumer?

-Refer to the graph above to answer this question.If the government imposes a price ceiling of $7,what will be the new price and quantity in the market?

The data shows the demand and supply for wheat: quantity of bushels per year (in million) -Refer to the information above to answer this question.What would be the cost to the government to support a price floor of $16 per bushel of wheat?

What is the term for an allocation system where sellers are allowed to determine the method of allocation on the basis of their own preferences?

-A price ceiling is a government regulation stipulating the maximum price that can be charged for a product.

Distinguish between shortage and scarcity.

What is a price floor?

-Refer to the above graph to answer this question.What will be the result in the market if the price is set at $70?

-Explain how the imposition of minimum wage legislation might cause unemployment.

What is 'rationing'? Why is rationing done?

-If both the demand and the supply increase,it is impossible to say whether the price will rise or fall.

The following table shows the demand for,and supply of,soya milk in a particular market (the quantities are in thousands of liters per day): -Refer to the above information to answer this question.Suppose that the government introduces an effective price ceiling which is 20 cents different from the equilibrium price.What will be the result?