Question 1

If a binding price floor is imposed on the video game market,then

Accepted Answer

A)   the quantity of video games demanded will decrease.
B)   the quantity of video games supplied will increase.
C)   a surplus of video games will develop.
D)   All of the above are correct.E) A) and B)
F) A) and C)

Question 2

A key lesson from the payroll tax is that the

Accepted Answer

A)   tax is a tax solely on workers.
B)   tax is a tax solely on firms that hire workers.
C)   tax eliminates any wedge that might exist between the wage that firms pay and the wage that workers receive.
D)   true burden of a tax cannot be legislated.E) None of the above
F) C) and D)

Question 3

Table 6-1
 
-Refer to Table 6-1.Suppose the government imposes a price ceiling of $1 on this market.What will be the size of the shortage in this market?

Accepted Answer

A)   0 units
B)   2 units
C)   8 units
D)   10 unitsE) A) and D)
F) None of the above

Question 4

To be binding,a price ceiling must be set above the equilibrium price.

Accepted Answer

A) True 
 B)False

Question 5

Figure 6-17 
-Refer to Figure 6-17.A price floor set at $60 would result in a surplus of 20 units.

Accepted Answer

A) True 
 B)False

Question 6

Who bears the majority of a tax burden depends on the relative elasticity of supply and demand.

Accepted Answer

A) True 
 B)False

Question 7

In the labor markets,workers determine the supply of labor and firms determine the demand.

Accepted Answer

A) True 
 B)False

Question 8

A tax of $1 on buyers shifts the demand curve downward by exactly $1.

Accepted Answer

A) True 
 B)False

Question 9

Using the graph shown,answer the following questions.
4.Using the graph shown,answer the following questions.
a.What was the equilibrium price in this market before the tax?
b.What is the amount of the tax?
c.How much of the tax will the buyers pay?
d.How much of the tax will the sellers pay?
e.How much will the buyer pay for the product after the tax is imposed?
f.How much will the seller receive after the tax is imposed?
g.As a result of the tax,what has happened to the level of market activity?

Accepted Answer

a.
$5
b.
$3
c.
$2
d.
$1
e.
$7
...

Question 10

Figure 6-9 
-Refer to Figure 6-9.The amount of the tax per unit is

Accepted Answer

A)   $1.
B)   $1.50.
C)   $2.
D)   $3.E) B) and D)
F) A) and B)

Question 11

Figure 6-4 
-Refer to Figure 6-4.Suppose a price ceiling of $5 is imposed on this market.As a result,

Accepted Answer

A)   the quantity of the good supplied decreases by 20 units.
B)   the demand curve shifts to the left so as to now pass through the point (quantity = 40,price = $5) .
C)   buyers' total expenditure on the good decreases by $100.
D)   the price of the good continues to serve as the rationing mechanism.E) A) and B)
F) A) and C)

Question 12

Rent control

Accepted Answer

A)   serves as an example of how a social problem can be alleviated or even solved by government policies.
B)   serves as an example of a price ceiling.
C)   is regarded by most economists as an efficient way of helping the poor.
D)   is the most efficient way to allocate scarce housing resources.E) A) and B)
F) A) and C)

Question 13

Suppose the government has imposed a price ceiling on televisions.Which of the following events could transform the price ceiling from one that is not binding into one that is binding?

Accepted Answer

A)   Firms expect the price of televisions to fall in the future.
B)   The number of firms selling televisions decreases.
C)   Consumers' income decreases,and televisions are a normal good.
D)   The number of consumers buying televisions decreases.E) A) and B)
F) None of the above

Question 14

Not all sellers benefit from a binding price floor.

Accepted Answer

A) True 
 B)False

Question 15

Buyers and sellers rarely share the burden of a tax equally.

Accepted Answer

A) True 
 B)False

Question 16

Figure 6-8 1 to S2,the resulting quantity of gasoline that is bought and sold is A)  less than Q3. B)  Q3. C)  between Q1 and Q3. D)  at least Q1." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 6-8.When the price ceiling applies in this market and the supply curve for gasoline shifts from S1 to S2,the resulting quantity of gasoline that is bought and sold is

Accepted Answer

A)   less than Q3.
B)   Q3.
C)   between Q1 and Q3.
D)   at least Q1.E) B) and C)
F) A) and D)

Question 17

Price floors are typically imposed to benefit buyers.

Accepted Answer

A) True 
 B)False

Question 18

Discrimination is an example of a rationing mechanism that may naturally develop in response to a binding price floor.

Accepted Answer

A) True 
 B)False

Question 19

A tax of $1 on sellers shifts the supply curve upward by exactly $1.

Accepted Answer

A) True 
 B)False

Question 20

Suppose that the demand for picture frames is inelastic and the supply of picture frames is elastic.A tax of $1 per frame levied on picture frames will decrease the effective price received by sellers of picture frames by

Accepted Answer

A)   less than $0.50.
B)   $0.50.
C)   between $0.50 and $1.
D)   $1.E) B) and C)
F) A) and B)

Exam 6: Supply, Demand, and Government Policies

A tax of $1 on sellers shifts the supply curve upward by exactly $1.

Correct Answer
verified

If a binding price floor is imposed on the video game market,then

Correct Answer
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Table 6-1 -Refer to Table 6-1.Suppose the government imposes a price ceiling of $1 on this market.What will be the size of the shortage in this market?

Correct Answer
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A key lesson from the payroll tax is that the

Correct Answer
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Who bears the majority of a tax burden depends on the relative elasticity of supply and demand.

Correct Answer
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Correct Answer
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a.
$5
b.
$3
c.
$2
d.
$1
e.
$7
...
View Answer

Figure 6-8 -Refer to Figure 6-8.When the price ceiling applies in this market and the supply curve for gasoline shifts from S₁ to S₂,the resulting quantity of gasoline that is bought and sold is

Correct Answer
verified

Suppose the government has imposed a price ceiling on televisions.Which of the following events could transform the price ceiling from one that is not binding into one that is binding?

Correct Answer
verified

Buyers and sellers rarely share the burden of a tax equally.

Correct Answer
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Figure 6-9 -Refer to Figure 6-9.The amount of the tax per unit is

Correct Answer
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Figure 6-4 -Refer to Figure 6-4.Suppose a price ceiling of $5 is imposed on this market.As a result,

Correct Answer
verified

Price floors are typically imposed to benefit buyers.

Correct Answer
verified

A tax of $1 on buyers shifts the demand curve downward by exactly $1.

Correct Answer
verified

Rent control

Correct Answer
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Not all sellers benefit from a binding price floor.

Correct Answer
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Figure 6-17 -Refer to Figure 6-17.A price floor set at $60 would result in a surplus of 20 units.

Correct Answer
verified

Suppose that the demand for picture frames is inelastic and the supply of picture frames is elastic.A tax of $1 per frame levied on picture frames will decrease the effective price received by sellers of picture frames by

Correct Answer
verified

To be binding,a price ceiling must be set above the equilibrium price.

Correct Answer
verified

In the labor markets,workers determine the supply of labor and firms determine the demand.

Correct Answer
verified

Discrimination is an example of a rationing mechanism that may naturally develop in response to a binding price floor.

Correct Answer
verified

Exam 6: Supply, Demand, and Government Policies

A tax of $1 on sellers shifts the supply curve upward by exactly $1.

Correct AnswerverifiedShow Answer

If a binding price floor is imposed on the video game market,then

Correct AnswerverifiedShow Answer

Table 6-1 -Refer to Table 6-1.Suppose the government imposes a price ceiling of $1 on this market.What will be the size of the shortage in this market?

Correct AnswerverifiedShow Answer

A key lesson from the payroll tax is that the

Correct AnswerverifiedShow Answer

Who bears the majority of a tax burden depends on the relative elasticity of supply and demand.

Correct AnswerverifiedShow Answer

Correct Answerverifieda.$5b.$3c.$2d.$1e.$7...View AnswerShow Answer

Figure 6-8 -Refer to Figure 6-8.When the price ceiling applies in this market and the supply curve for gasoline shifts from S1 to S2,the resulting quantity of gasoline that is bought and sold is

Correct AnswerverifiedShow Answer

Suppose the government has imposed a price ceiling on televisions.Which of the following events could transform the price ceiling from one that is not binding into one that is binding?

Correct AnswerverifiedShow Answer

Buyers and sellers rarely share the burden of a tax equally.

Correct AnswerverifiedShow Answer

Figure 6-9 -Refer to Figure 6-9.The amount of the tax per unit is

Correct AnswerverifiedShow Answer

Figure 6-4 -Refer to Figure 6-4.Suppose a price ceiling of $5 is imposed on this market.As a result,

Correct AnswerverifiedShow Answer

Price floors are typically imposed to benefit buyers.

Correct AnswerverifiedShow Answer

A tax of $1 on buyers shifts the demand curve downward by exactly $1.

Correct AnswerverifiedShow Answer

Rent control

Correct AnswerverifiedShow Answer

Not all sellers benefit from a binding price floor.

Correct AnswerverifiedShow Answer

Figure 6-17 -Refer to Figure 6-17.A price floor set at $60 would result in a surplus of 20 units.

Correct AnswerverifiedShow Answer

Suppose that the demand for picture frames is inelastic and the supply of picture frames is elastic.A tax of $1 per frame levied on picture frames will decrease the effective price received by sellers of picture frames by

Correct AnswerverifiedShow Answer

To be binding,a price ceiling must be set above the equilibrium price.

Correct AnswerverifiedShow Answer

In the labor markets,workers determine the supply of labor and firms determine the demand.

Correct AnswerverifiedShow Answer

Discrimination is an example of a rationing mechanism that may naturally develop in response to a binding price floor.

Correct AnswerverifiedShow Answer

Correct Answer
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verified
a.
$5
b.
$3
c.
$2
d.
$1
e.
$7
...
View Answer

Figure 6-8 -Refer to Figure 6-8.When the price ceiling applies in this market and the supply curve for gasoline shifts from S₁ to S₂,the resulting quantity of gasoline that is bought and sold is

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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