Exam 7: Government Actions in Markets

A rent ceiling controls the rent portion of the cost of housing but not the search cost.So when the search cost is ________ the rent,some people end up paying a ________ opportunity cost for housing than they would if there were no rent ceiling.

-The above figure shows the supply curves in four different markets.If each of the markets has an identical downward sloping demand curve and the same tax is levied on suppliers,which market would produce the smallest amount of deadweight loss?

If a $1 sales tax is imposed on the sale of a CD,and neither the demand nor the supply is perfectly elastic or perfectly inelastic,then the price of a CD paid by consumers will

-The above figure shows the domestic market for wheat.Suppose this market is isolated from global competition and the government intervenes by setting a support price of $15 a ton.The quantity produced once the price support is in place is

The figure above shows the supply and demand curves in the market for rental housing.A rent ceiling is set at $400 per month. -As shown in the figure above,the rent ceiling ________ consumer surplus and ________ producer surplus.

Suppose the elasticity of demand for Mexican food is 3.00 and the elasticity of supply is 1.20.If the government imposes a sales tax on Mexican food,which of the following occurs? I.Less Mexican food is purchased by buyers. Ii.Less Mexican food is produced by sellers. Iii.The government receives the excess burden as revenue. Iv.Both the consumer surplus and the producer surplus decrease.

-The graph shows the market for ski chalets in Aspen.If a rent ceiling is set at $1,900 a week,then the maximum amount charged in the black market is ________ a week.

-The figure above shows the labor market in a region.In which of the following cases would the amount of unemployment be the largest?

A minimum wage that is above the equilibrium wage rate

For a given supply elasticity,the more inelastic the demand for a good,the larger the share of the tax paid by the

-The above figure shows the demand curves in four different markets.If each of the markets has an identical upward sloping supply curve and the same tax is levied on suppliers,which market would produce the largest amount of deadweight loss?

Import restriction in advanced economies deny developing economies access to the food market of the advanced economies.The result is ________ price and ________ farm production in the developing economies.

Which of the following results from a price ceiling? I.increased search activity Ii.surplus Iii.black market

If a minimum wage is introduced that is above the equilibrium wage rate,

-To determine who bears the greater share of a tax,we compare the

Tax incidence refers to

-The figure above illustrates the current market for apartments in Washington,D.C. a.If the local government imposes a price ceiling of $1,500 per month,is there a shortage? If so,how much? If not,why not? b.If the local government imposes a price ceiling of $900 per month,is there a shortage? If so,how much? If not,why not?

To keep the price at the level set by a price support,the government must

A price ceiling in the market for gasoline that is below the equilibrium price will lead to

In a housing market with a rent ceiling set below the equilibrium rent,as time passes the supply of apartments