Question 1

A rent ceiling set below the equilibrium rent decreases the quantity of housing supplied because

Accepted Answer

A) landlords of previously barely profitable apartments refuse to rent them. 
B) the supply of housing increases. 
C) fewer tenants will search for housing. 
D) demand for housing will increase. 
E) the supply curve of housing immediately shifts leftward. 
A) landlords of previously barely profitable apartments refuse to rent them. 
B) the supply of housing increases. 
C) fewer tenants will search for housing. 
D) demand for housing will increase. 
E) the supply curve of housing immediately shifts leftward.

Question 2

-The above figure shows the domestic market for tomatoes.Suppose this market is isolated from global competition and there is a support price set at $16.In this figure,what area equals the consumer surplus?

Accepted Answer

A) area A + area B + area C 
B) area A + area F 
C) area C + area D + area E + area G 
D) area A 
E) area F 
A) area A + area B + area C 
B) area A + area F 
C) area C + area D + area E + area G 
D) area A 
E) area F

Question 3

An efficient allocation of labor occurs when the

Accepted Answer

A) marginal benefit to workers exceeds the marginal benefit to firms. 
B) marginal benefit to firms exceeds the marginal benefit to workers. 
C) marginal cost to workers is equal to the marginal benefit to firms. 
D) marginal cost and marginal benefit of both workers and the firms are equal to zero. 
E) marginal benefit of workers exceeds the marginal cost to firms by as much as possible. 
A) marginal benefit to workers exceeds the marginal benefit to firms. 
B) marginal benefit to firms exceeds the marginal benefit to workers. 
C) marginal cost to workers is equal to the marginal benefit to firms. 
D) marginal cost and marginal benefit of both workers and the firms are equal to zero. 
E) marginal benefit of workers exceeds the marginal cost to firms by as much as possible.

Question 4

When a price ceiling is set below the equilibrium price,the quantity supplied ________ the quantity demanded and ________ exists.

Accepted Answer

A) is less than;a surplus 
B) is less than;a shortage 
C) is greater than;a surplus 
D) is greater than;a shortage 
E) equals;an equilibrium 
A) is less than;a surplus 
B) is less than;a shortage 
C) is greater than;a surplus 
D) is greater than;a shortage 
E) equals;an equilibrium

Question 5

-The demand for apple pies is perfectly elastic.If the government taxes apple pies at $1 a pie,then

Accepted Answer

A) the seller pays the entire tax. 
B) the buyer pays the entire tax. 
C) the seller and the buyer split the tax evenly. 
D) the seller and the buyer split the tax but the seller pays more. 
E) who pays the tax depends on whether the government imposes the tax on pie buyers or on pie sellers. 
A) the seller pays the entire tax. 
B) the buyer pays the entire tax. 
C) the seller and the buyer split the tax evenly. 
D) the seller and the buyer split the tax but the seller pays more. 
E) who pays the tax depends on whether the government imposes the tax on pie buyers or on pie sellers.

Question 6

-In the figure above,if the minimum wage is $8 per hour,then

Accepted Answer

A) resources used in job-search activity increase compared to the situation before the minimum wage. 
B) it is legal to hire workers for a wage below the minimum wage because otherwise unemployment would result. 
C) the deadweight loss is minimized. 
D) Both answers A and B are correct. 
E) Both answers B and C are correct. 
A) resources used in job-search activity increase compared to the situation before the minimum wage. 
B) it is legal to hire workers for a wage below the minimum wage because otherwise unemployment would result. 
C) the deadweight loss is minimized. 
D) Both answers A and B are correct. 
E) Both answers B and C are correct.

Question 7

Suppose that apartments rent for $1,300 a month in San Francisco,California and $850 a month in Los Angeles,California.If the state of California passes a state-wide rent ceiling for apartments of $1,100 a month,what occurs in the two cities?

Accepted Answer

The rent ceiling is below the equilibriu

Question 8

People who benefit from a rent ceiling include

Accepted Answer

A) all landlords. 
B) taxpayers. 
C) tenants who have a rent-controlled apartment. 
D) potential tenants,that is,people looking for apartments. 
E) all landlords and some tenants. 
A) all landlords. 
B) taxpayers. 
C) tenants who have a rent-controlled apartment. 
D) potential tenants,that is,people looking for apartments. 
E) all landlords and some tenants.

Question 9

-The above figure shows the market for biologists.The government decides to set a minimum wage for biologists of $18 per hour.After this minimum wage is in effect,unemployment equals ________ workers.

Accepted Answer

A) 100 
B) 300 
C) 400 
D) 500 
E) 200 
A) 100 
B) 300 
C) 400 
D) 500 
E) 200

Question 10

One result of a minimum wage is

Accepted Answer

A) illegal hiring of people at wages below the minimum wage. 
B) more people with jobs. 
C) a change in the equilibrium wage. 
D) lower costs paid by firms. 
E) fewer people searching for work because they realize that firms have decreased the number of people hired. 
A) illegal hiring of people at wages below the minimum wage. 
B) more people with jobs. 
C) a change in the equilibrium wage. 
D) lower costs paid by firms. 
E) fewer people searching for work because they realize that firms have decreased the number of people hired.

Question 11

A minimum wage

Accepted Answer

A) increases all workers' surplus because the wage rate increases. 
B) increases consumer surplus because the price of the good decreases. 
C) decreases the firms' surplus because fewer workers are hired at the higher wage. 
D) increases the firms' surplus and the workers' surplus because it increases the efficiency of the labor market. 
E) None of the above answers is correct. 
A) increases all workers' surplus because the wage rate increases. 
B) increases consumer surplus because the price of the good decreases. 
C) decreases the firms' surplus because fewer workers are hired at the higher wage. 
D) increases the firms' surplus and the workers' surplus because it increases the efficiency of the labor market. 
E) None of the above answers is correct.

Question 12

A price floor is a price

Accepted Answer

A) below which a seller cannot legally sell. 
B) above which a seller cannot legally sell. 
C) that creates a shortage of the good if it is set above the equilibrium price. 
D) Both answers A and C are correct. 
E) Both answers B and C are correct. 
A) below which a seller cannot legally sell. 
B) above which a seller cannot legally sell. 
C) that creates a shortage of the good if it is set above the equilibrium price. 
D) Both answers A and C are correct. 
E) Both answers B and C are correct.

Question 13

-The graph shows the market for holiday condos in West Palm Beach.If a rent ceiling is set at $1,700 a week,the quantity of holiday condos rented

Accepted Answer

A) is 2,000 a week. 
B) is 4,000 a week. 
C) is 5,000 a week. 
D) is some amount,but more information is needed to determine the amount. 
E) depends on the black market. 
A) is 2,000 a week. 
B) is 4,000 a week. 
C) is 5,000 a week. 
D) is some amount,but more information is needed to determine the amount. 
E) depends on the black market.

Question 14

-The demand and supply schedules for pizza are in the table above.A price ceiling of $4 per slice results in

Accepted Answer

A) a surplus of 20 slices of pizza. 
B) a shortage of 20 slices of pizza. 
C) a shortage of 40 slices of pizza. 
D) a shortage of 60 slices of pizza. 
E) neither a shortage nor a surplus. 
A) a surplus of 20 slices of pizza. 
B) a shortage of 20 slices of pizza. 
C) a shortage of 40 slices of pizza. 
D) a shortage of 60 slices of pizza. 
E) neither a shortage nor a surplus.

Question 15

When a price support is set above the equilibrium price,producers ________ the quantity supplied and consumers ________ the quantity demanded.

Accepted Answer

A) increase;increase 
B) increase;decrease 
C) decrease;increase 
D) decrease;decrease 
E) do not change;do not change 
A) increase;increase 
B) increase;decrease 
C) decrease;increase 
D) decrease;decrease 
E) do not change;do not change

Question 16

Which of the following can create a deadweight loss?
I.price supports
Ii.price floor
Iii.price ceiling

Accepted Answer

A) i only 
B) i and iii 
C) ii and iii 
D) i,ii and iii 
E) i and ii 
A) i only 
B) i and iii 
C) ii and iii 
D) i,ii and iii 
E) i and ii

Question 17

-The above figure shows the market for finish carpenters in Bozeman.If there is a minimum wage set at $18,what is true?

Accepted Answer

A) The lowest wage for which someone is willing to work is $18 an hour. 
B) The quantity of jobs increases to 400. 
C) The lowest wage for which someone is willing to work is $20 an hour. 
D) 200 workers are employed. 
E) The quantity of jobs demanded is more than the quantity supplied. 
A) The lowest wage for which someone is willing to work is $18 an hour. 
B) The quantity of jobs increases to 400. 
C) The lowest wage for which someone is willing to work is $20 an hour. 
D) 200 workers are employed. 
E) The quantity of jobs demanded is more than the quantity supplied.

Question 18

Price supports are generally used in

Accepted Answer

A) labor markets. 
B) industrial markets. 
C) housing markets. 
D) markets for services. 
E) agricultural markets. 
A) labor markets. 
B) industrial markets. 
C) housing markets. 
D) markets for services. 
E) agricultural markets.

Question 19

Which of the following is true?
I.A price ceiling set below the equilibrium price decreases search activity.
Ii.A minimum wage is an example of a price ceiling.
Iii.A price support decreases the quantity consumed.

Accepted Answer

A) only i 
B) only ii 
C) only iii 
D) i and iii 
E) ii and iii 
A) only i 
B) only ii 
C) only iii 
D) i and iii 
E) ii and iii

Question 20

The figure above shows the market for sugar beets.The government intervenes in this market and sets a support price at $35 a ton.
-The figure above shows that the government subsidy accounts for ________ percent of the farmers' revenue.

Accepted Answer

A) 33 
B) 67 
C) 50 
D) 100 
E) 25 
A) 33 
B) 67 
C) 50 
D) 100 
E) 25

A rent ceiling set below the equilibrium rent decreases the quantity of housing supplied because

-The above figure shows the domestic market for tomatoes.Suppose this market is isolated from global competition and there is a support price set at $16.In this figure,what area equals the consumer surplus?

An efficient allocation of labor occurs when the

When a price ceiling is set below the equilibrium price,the quantity supplied the quantity demanded and exists.

-The demand for apple pies is perfectly elastic.If the government taxes apple pies at $1 a pie,then

-In the figure above,if the minimum wage is $8 per hour,then

Suppose that apartments rent for $1,300 a month in San Francisco,California and $850 a month in Los Angeles,California.If the state of California passes a state-wide rent ceiling for apartments of $1,100 a month,what occurs in the two cities?

People who benefit from a rent ceiling include

-The above figure shows the market for biologists.The government decides to set a minimum wage for biologists of $18 per hour.After this minimum wage is in effect,unemployment equals ________ workers.

One result of a minimum wage is

A minimum wage

A price floor is a price

-The graph shows the market for holiday condos in West Palm Beach.If a rent ceiling is set at $1,700 a week,the quantity of holiday condos rented

-The demand and supply schedules for pizza are in the table above.A price ceiling of $4 per slice results in

When a price support is set above the equilibrium price,producers the quantity supplied and consumers the quantity demanded.

Which of the following can create a deadweight loss? I.price supports Ii.price floor Iii.price ceiling

-The above figure shows the market for finish carpenters in Bozeman.If there is a minimum wage set at $18,what is true?

Price supports are generally used in

Which of the following is true? I.A price ceiling set below the equilibrium price decreases search activity. Ii.A minimum wage is an example of a price ceiling. Iii.A price support decreases the quantity consumed.

The figure above shows the market for sugar beets.The government intervenes in this market and sets a support price at $35 a ton. -The figure above shows that the government subsidy accounts for ________ percent of the farmers' revenue.

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

Exam 7: Government Actions in Markets

A rent ceiling set below the equilibrium rent decreases the quantity of housing supplied because

-The above figure shows the domestic market for tomatoes.Suppose this market is isolated from global competition and there is a support price set at $16.In this figure,what area equals the consumer surplus?

An efficient allocation of labor occurs when the

When a price ceiling is set below the equilibrium price,the quantity supplied ________ the quantity demanded and ________ exists.

-The demand for apple pies is perfectly elastic.If the government taxes apple pies at $1 a pie,then

-In the figure above,if the minimum wage is $8 per hour,then

Suppose that apartments rent for $1,300 a month in San Francisco,California and $850 a month in Los Angeles,California.If the state of California passes a state-wide rent ceiling for apartments of $1,100 a month,what occurs in the two cities?

People who benefit from a rent ceiling include

-The above figure shows the market for biologists.The government decides to set a minimum wage for biologists of $18 per hour.After this minimum wage is in effect,unemployment equals ________ workers.

One result of a minimum wage is

A minimum wage

A price floor is a price

-The graph shows the market for holiday condos in West Palm Beach.If a rent ceiling is set at $1,700 a week,the quantity of holiday condos rented

-The demand and supply schedules for pizza are in the table above.A price ceiling of $4 per slice results in

When a price support is set above the equilibrium price,producers ________ the quantity supplied and consumers ________ the quantity demanded.

Which of the following can create a deadweight loss? I.price supports Ii.price floor Iii.price ceiling

-The above figure shows the market for finish carpenters in Bozeman.If there is a minimum wage set at $18,what is true?

Price supports are generally used in

Which of the following is true? I.A price ceiling set below the equilibrium price decreases search activity. Ii.A minimum wage is an example of a price ceiling. Iii.A price support decreases the quantity consumed.

The figure above shows the market for sugar beets.The government intervenes in this market and sets a support price at $35 a ton. -The figure above shows that the government subsidy accounts for ________ percent of the farmers' revenue.

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

When a price ceiling is set below the equilibrium price,the quantity supplied the quantity demanded and exists.

When a price support is set above the equilibrium price,producers the quantity supplied and consumers the quantity demanded.