Exam 5: Price Ceilings and Floors

Use the following to answer questions Figure: Water Market -(Figure: Water Market)Refer to the figure.If a price floor in the diagram gets set at $8 a gallon,what is the quality waste?

Ben is willing to work for $4/hour and an employer is willing to hire Ben for $7/hour.Which statements is TRUE?

Ancient Athens had strict controls on the price of wheat,and punishment for violation of the price control was death.The speech by a politician imploring a jury to convict an alleged violator of the law survives to this day: "And consider that in consequence of this vocation,very many have already stood trial for their lives;and so great the [earnings] which they are able to derive from it that they prefer to risk their life every day,rather than cease to draw from,the public,their improper profits." Which of the following is the most likely reason why merchants were willing to risk their lives to charge more than the legal price?

If a minimum wage is posted in the labor market:

When the minimum price that can be legally charged is above the market price,we say there is a price:

Use the following to answer questions Figure: Government Price Controls -(Figure: Government Price Controls)Refer to the figure.The government enacts a price control causing a shortage of 15 units of the good.Therefore,the ________ is set at ________.

One of the virtues of the market process is that it is open to new ideas,innovations,and:

Use the following to answer questions Figure: Price Ceilings and Consumer Surplus -(Figure: Price Ceilings and Consumer Surplus)Refer to the figure.There is a price ceiling of $20.What is the value of consumer surplus if all the goods are allocated randomly?

Use the following to answer question Figure: Supply and Demand 3 -(Figure: Supply and Demand 3)Refer to the figure.If the government sets a price ceiling at $8 in this figure,it will create a deadweight loss of:

Use the following to answer questions Figure: Price Ceilings and Valuation of Uses -(Figure: Price Ceilings and Valuation of Uses)Refer to the figure.Suppose a price ceiling of $15 goes into effect.If the highest-value use and the lowest-value use are equally likely to be satisfied,then the average value of the product is:

When a price ceiling is in effect,goods and services:

When the price ceilings on oil and gas were lifted in January 1981: I.the price of oil rose immediately. II.the price of oil continued to rise more than 2 years after the controls were eliminated. III.higher prices gave an incentive to suppliers to increase supply,thus leading eventually to lower prices.

People typically blame price controls for the problems caused by price controls.

Economists call the maximum legal price a price ceiling because the price:

Which of the following statements is TRUE?

Figure: Labor Market 2 Refer to the figure.In the figure,there will be 6 unemployed workers at a minimum wage of:

A rent control is a regulation that:

Currently,the federal minimum wage is set at $7.25 per hour.A survey conducted by Newsweek magazine (June 27,2011)indicated that many Americans would be willing to work for far less than the minimum wage-some as low as 25¢ per hour! What would happen if the U.S.government eliminated the minimum wage,and instead let wages be set by the marketplace?

Although a minimum wage increases unemployment,it doesn't create a deadweight loss.

What does the Russian word blat refer to?