Question 1

The minimum wage has its greatest impact on the market for teenage labor.

Accepted Answer

A) True 
 B)False

Question 2

Table 6-4
The following table contains the demand schedule and supply schedule for a market for a particular good. Suppose sellers of the good successfully lobby Congress to impose a price floor $3 above the equilibrium price in this market.
 
-Refer to Table 6-4.Following the imposition of a price floor $3 above the equilibrium price,irate buyers convince Congress to repeal the price floor and to impose a price ceiling $1 below the former price floor.The resulting market price is

Accepted Answer

A)   $2.
B)   $3.
C)   $4.
D)   $5.E) All of the above
F) C) and D)

Question 3

When a binding price ceiling is imposed on a market to benefit buyers,

Accepted Answer

A)   every buyer in the market benefits.
B)   every buyer and seller in the market benefits.
C)   every buyer who wants to buy the good will be able to do so, but only if he waits in long lines.
D)   some buyers will not be able to buy any amount of the good.E) B) and D)
F) B) and C)

Question 4

Prices are inefficient rationing devices.

Accepted Answer

A) True 
 B)False

Question 5

Not all sellers benefit from a binding price floor.

Accepted Answer

A) True 
 B)False

Question 6

Figure 6-1

-Refer to Figure 6-1.The price ceiling shown in panel (b)

Accepted Answer

A)   is not binding.
B)   creates a surplus.
C)   creates a shortage.
D)   Both a)  and b)  are correct.E) All of the above
F) B) and D)

Question 7

Most economists are in favor of price controls as a way of allocating resources in the economy.

Accepted Answer

A) True 
 B)False

Question 8

A binding minimum wage tends to

Accepted Answer

A)   cause a labor surplus.
B)   cause unemployment.
C)   have the greatest impact in the market for teenage labor.
D)   All of the above are correct.E) B) and D)
F) C) and D)

Question 9

In the United States,before OPEC increased the price of crude oil in 1973,there was

Accepted Answer

A)   no price ceiling on gasoline.
B)   a nonbinding price ceiling on gasoline.
C)   a binding price ceiling on gasoline.
D)   a nonbinding price floor on gasoline.E) None of the above
F) B) and C)

Question 10

Whether a tax is levied on sellers or buyers,buyers and sellers usually share the burden of taxes.

Accepted Answer

A) True 
 B)False

Question 11

Congress intended that

Accepted Answer

A)   the entire FICA tax be paid by workers.
B)   the entire FICA tax be paid by firms.
C)   one-quarter of the FICA tax be paid by workers, and three-quarters be paid by firms.
D)   half the FICA tax be paid by workers, and half be paid by firms.E) A) and B)
F) A) and C)

Question 12

A payroll tax is a

Accepted Answer

A)   fixed number of dollars that every firm must pay to the government for each worker that the firm hires.
B)   tax that each firm must pay to the government before the firm can hire workers and operate its business.
C)   tax on the wages that firms pay their workers.
D)   tax on all wages above the minimum wage.E) A) and C)
F) B) and D)

Question 13

Figure 6-10
 
-Refer to Figure 6-10.A price ceiling set at

Accepted Answer

A)   $6 will be binding and will result in a shortage of 8 units.
B)   $6 will be binding and will result in a shortage of 4 units.
C)   $16 will be binding and will result in a shortage of 12 units.
D)   $16 will be binding and will result in a shortage of 6 units.E) A) and B)
F) A) and C)

Question 14

If the equilibrium price of an airline ticket is $500 and the government imposes a price floor of $400 on airline tickets,then fewer airline tickets will be sold than at the market equilibrium.

Accepted Answer

A) True 
 B)False

Question 15

The rationing mechanisms that develop under binding price floors are usually efficient.

Accepted Answer

A) True 
 B)False

Question 16

A price floor is a legal minimum on the price at which a good or service can be sold.

Accepted Answer

A) True 
 B)False

Question 17

An alternative to rent-control laws that would not reduce the quantity of housing supplied is

Accepted Answer

A)   the payment by government of a fraction of a poor family's rent.
B)   higher taxes on rental income earned by landlords.
C)   a policy that prevents landlords from evicting tenants.
D)   a policy that allows government to confiscate residential property for the purpose of commercial development.E) A) and B)
F) None of the above

Question 18

Figure 6-18
 
-Refer to Figure 6-18.The effective price sellers receive after the tax is imposed is

Accepted Answer

A)   $2.50.
B)   $3.50.
C)   $5.00.
D)   $6.00.E) B) and D)
F) A) and D)

Question 19

If a tax is levied on the sellers of a product,then there will be a(n)

Accepted Answer

A)   downward shift of the supply curve.
B)   upward shift of the supply curve.
C)   movement up and to the right along the supply curve.
D)   movement down and to the left along the supply curve.E) A) and B)
F) A) and C)

Question 20

Using a supply and demand diagram,show a labor market with a binding minimum wage.Use the diagram to show those who are helped by the minimum wage and those who are hurt by the minimum wage.

Accepted Answer

a.For this example,a $300 price ceiling ...

Exam 6: Supply, Demand, And Government Policies.

Figure 6-18 -Refer to Figure 6-18.The effective price sellers receive after the tax is imposed is

Correct Answer
verified

Prices are inefficient rationing devices.

Correct Answer
verified

Figure 6-1 -Refer to Figure 6-1.The price ceiling shown in panel (b)

Correct Answer
verified

In the United States,before OPEC increased the price of crude oil in 1973,there was

Correct Answer
verified

When a binding price ceiling is imposed on a market to benefit buyers,

Correct Answer
verified

A price floor is a legal minimum on the price at which a good or service can be sold.

Correct Answer
verified

An alternative to rent-control laws that would not reduce the quantity of housing supplied is

Correct Answer
verified

If the equilibrium price of an airline ticket is $500 and the government imposes a price floor of $400 on airline tickets,then fewer airline tickets will be sold than at the market equilibrium.

Correct Answer
verified

Correct Answer
verified

Figure 6-10 -Refer to Figure 6-10.A price ceiling set at

Correct Answer
verified

If a tax is levied on the sellers of a product,then there will be a(n)

Correct Answer
verified

A binding minimum wage tends to

Correct Answer
verified

Using a supply and demand diagram,show a labor market with a binding minimum wage.Use the diagram to show those who are helped by the minimum wage and those who are hurt by the minimum wage.

Correct Answer
verified
a.For this example,a $300 price ceiling ...
View Answer

Congress intended that

Correct Answer
verified

The minimum wage has its greatest impact on the market for teenage labor.

Correct Answer
verified

Whether a tax is levied on sellers or buyers,buyers and sellers usually share the burden of taxes.

Correct Answer
verified

Not all sellers benefit from a binding price floor.

Correct Answer
verified

Most economists are in favor of price controls as a way of allocating resources in the economy.

Correct Answer
verified

A payroll tax is a

Correct Answer
verified

The rationing mechanisms that develop under binding price floors are usually efficient.

Correct Answer
verified

Exam 6: Supply, Demand, And Government Policies.

Figure 6-18 -Refer to Figure 6-18.The effective price sellers receive after the tax is imposed is

Correct AnswerverifiedShow Answer

Prices are inefficient rationing devices.

Correct AnswerverifiedShow Answer

Figure 6-1 -Refer to Figure 6-1.The price ceiling shown in panel (b)

Correct AnswerverifiedShow Answer

In the United States,before OPEC increased the price of crude oil in 1973,there was

Correct AnswerverifiedShow Answer

When a binding price ceiling is imposed on a market to benefit buyers,

Correct AnswerverifiedShow Answer

A price floor is a legal minimum on the price at which a good or service can be sold.

Correct AnswerverifiedShow Answer

An alternative to rent-control laws that would not reduce the quantity of housing supplied is

Correct AnswerverifiedShow Answer

If the equilibrium price of an airline ticket is $500 and the government imposes a price floor of $400 on airline tickets,then fewer airline tickets will be sold than at the market equilibrium.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 6-10 -Refer to Figure 6-10.A price ceiling set at

Correct AnswerverifiedShow Answer

If a tax is levied on the sellers of a product,then there will be a(n)

Correct AnswerverifiedShow Answer

A binding minimum wage tends to

Correct AnswerverifiedShow Answer

Using a supply and demand diagram,show a labor market with a binding minimum wage.Use the diagram to show those who are helped by the minimum wage and those who are hurt by the minimum wage.

Correct Answerverifieda.For this example,a $300 price ceiling ...View AnswerShow Answer

Congress intended that

Correct AnswerverifiedShow Answer

The minimum wage has its greatest impact on the market for teenage labor.

Correct AnswerverifiedShow Answer

Whether a tax is levied on sellers or buyers,buyers and sellers usually share the burden of taxes.

Correct AnswerverifiedShow Answer

Not all sellers benefit from a binding price floor.

Correct AnswerverifiedShow Answer

Most economists are in favor of price controls as a way of allocating resources in the economy.

Correct AnswerverifiedShow Answer

A payroll tax is a

Correct AnswerverifiedShow Answer

The rationing mechanisms that develop under binding price floors are usually efficient.

Correct AnswerverifiedShow Answer

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a.For this example,a $300 price ceiling ...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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