Question 1

A binding price ceiling may not help all consumers, but it does not hurt any consumers.

Accepted Answer

A) True 
 B)False

Question 2

Scenario 6-1
Suppose that demand in the market for good X is given by the equation  and that supply in the market for good X is given by the equation 
-Refer to Scenario 6-1. If the government set a price floor at $13, would there be a shortage or surplus, and how large would be the shortage/surplus?

Accepted Answer

A price floor set at...

Question 3

A price ceiling set below the equilibrium price causes a shortage in the market.

Accepted Answer

A) True 
 B)False

Question 4

Figure 6-25 
-Refer to Figure 6-25. Suppose the same supply and demand curves apply, and a tax of the same amount per unit as shown here is imposed. Now, however, the sellers of the good, rather than the buyers, are required to pay the tax to the government. After the sellers are required to pay the tax, relative to the case depicted in the graph, the burden on buyers will be

Accepted Answer

A)   larger, and the burden on sellers will be smaller.
B)   smaller, and the burden on sellers will be larger.
C)   the same, and the burden on sellers will be the same.
D)   The relative burdens in the two cases cannot be determined without further information.E) All of the above
F) C) and D)

Question 5

Define a price floor.

Accepted Answer

A price floor is a l...

Question 6

A tax on buyers increases the size of a market.

Accepted Answer

A) True 
 B)False

Question 7

If a price ceiling is a binding constraint on a market, then

Accepted Answer

A)   the equilibrium price must be below the price ceiling.
B)   the quantity supplied must exceed the quantity demanded.
C)   sellers cannot sell all they want to sell at the price ceiling.
D)   buyers cannot buy all they want to buy at the price ceiling.E) A) and B)
F) A) and C)

Question 8

Figure 6-33 
-Refer to Figure 6-33. Suppose a $4 per-unit tax is imposed on the sellers of this good. How many units of this good will be sold after the tax is imposed?

Accepted Answer

With a $4 per-unit t...

Question 9

Figure 6-32 
-Refer to Figure 6-32. If the government set a price ceiling at $80, would there be a shortage or surplus, and how large would be the shortage/surplus?

Accepted Answer

A price ceiling set at $80 wou...

Question 10

Define a price ceiling.

Accepted Answer

A price ceiling is a...

Question 11

Which of the following is not a rationing mechanism used by landlords in cities with rent control?

Accepted Answer

A)   waiting lists
B)   race
C)   price
D)   bribesE) A) and C)
F) A) and B)

Question 12

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

Accepted Answer

A) True 
 B)False

Question 13

Figure 6-6 
-Refer to Figure 6-6. Which of the following statements is not correct?

Accepted Answer

A)   A price ceiling set at $6 would be binding, but a price ceiling set at $12 would not be binding.
B)   A price floor set at $14 would be binding, but a price floor set at $8 would not be binding.
C)   A price ceiling set at $9 would result in a shortage.
D)   A price floor set at $6 would result in a shortage.E) A) and C)
F) A) and B)

Question 14

Figure 6-22 
-Refer to Figure 6-22. As the figure is drawn, who sends the tax payment to the government?

Accepted Answer

A)   The buyers send the tax payment.
B)   The sellers send the tax payment.
C)   A portion of the tax payment is sent by the buyers, and the remaining portion is sent by the sellers.
D)   The question of who sends the tax payment cannot be determined from the graph.E) None of the above
F) A) and B)

Question 15

Which of the following statements is correct concerning the burden of a tax imposed on take-out food?

Accepted Answer

A)   Buyers bear the entire burden of the tax.
B)   Sellers bear the entire burden of the tax.
C)   Buyers and sellers share the burden of the tax.
D)   We have to know whether it is the buyers or the sellers that are required to pay the tax to the government in order to make this determination.E) C) and D)
F) B) and C)

Question 16

Figure 6-22 
-Refer to Figure 6-22. The effective price sellers receive after the tax is imposed is

Accepted Answer

A)   $2.00.
B)   $3.50.
C)   $5.00.
D)   $3.00.E) A) and B)
F) B) and C)

Question 17

Suppose the equilibrium price of a tube of toothpaste is $2, and the government imposes a price floor of $3 per tube. As a result of the price floor,

Accepted Answer

A)   quantity demanded decreases.
B)   quantity supplied increases.
C)   there is a surplus.
D)   All of the above are correct.E) None of the above
F) A) and C)

Question 18

When a tax is placed on the sellers of energy drinks, the

Accepted Answer

A)   sellers bear the entire burden of the tax.
B)   buyers bear the entire burden of the tax.
C)   burden of the tax will be always be equally divided between the buyers and the sellers.
D)   burden of the tax will be shared by the buyers and the sellers, but the division of the burden is not always equal.E) A) and B)
F) A) and C)

Question 19

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 10 units.
B)   $6 will be binding and will result in a shortage of 6 units.
C)   $16 will be binding and will result in a shortage of 10 units.
D)   $16 will be binding and will result in a shortage of 4 units.E) All of the above
F) C) and D)

Question 20

A price floor is binding when it is set

Accepted Answer

A)   above the equilibrium price, causing a shortage.
B)   above the equilibrium price, causing a surplus.
C)   below the equilibrium price, causing a shortage.
D)   below the equilibrium price, causing a surplus.E) A) and D)
F) None of the above

Exam 6: Supply, Demand, and Government Policies

If a price ceiling is a binding constraint on a market, then

Correct Answer
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Which of the following is not a rationing mechanism used by landlords in cities with rent control?

Correct Answer
verified

A tax on buyers increases the size of a market.

Correct Answer
verified

A price floor is binding when it is set

Correct Answer
verified

A binding price ceiling may not help all consumers, but it does not hurt any consumers.

Correct Answer
verified

Figure 6-33 -Refer to Figure 6-33. Suppose a $4 per-unit tax is imposed on the sellers of this good. How many units of this good will be sold after the tax is imposed?

Correct Answer
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With a $4 per-unit t...
View Answer

A price ceiling set below the equilibrium price causes a shortage in the market.

Correct Answer
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Suppose the equilibrium price of a tube of toothpaste is $2, and the government imposes a price floor of $3 per tube. As a result of the price floor,

Correct Answer
verified

Figure 6-22 -Refer to Figure 6-22. As the figure is drawn, who sends the tax payment to the government?

Correct Answer
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When a tax is placed on the sellers of energy drinks, the

Correct Answer
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Figure 6-22 -Refer to Figure 6-22. The effective price sellers receive after the tax is imposed is

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

Correct Answer
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Figure 6-32 -Refer to Figure 6-32. If the government set a price ceiling at $80, would there be a shortage or surplus, and how large would be the shortage/surplus?

Correct Answer
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A price ceiling set at $80 wou...
View Answer

Define a price floor.

Correct Answer
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A price floor is a l...
View Answer

Define a price ceiling.

Correct Answer
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A price ceiling is a...
View Answer

Figure 6-6 -Refer to Figure 6-6. Which of the following statements is not correct?

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

Correct Answer
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Which of the following statements is correct concerning the burden of a tax imposed on take-out food?

Correct Answer
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Scenario 6-1 Suppose that demand in the market for good X is given by the equation and that supply in the market for good X is given by the equation -Refer to Scenario 6-1. If the government set a price floor at $13, would there be a shortage or surplus, and how large would be the shortage/surplus?

Correct Answer
verified
A price floor set at...
View Answer

Exam 6: Supply, Demand, and Government Policies

If a price ceiling is a binding constraint on a market, then

Correct AnswerverifiedShow Answer

Which of the following is not a rationing mechanism used by landlords in cities with rent control?

Correct AnswerverifiedShow Answer

A tax on buyers increases the size of a market.

Correct AnswerverifiedShow Answer

A price floor is binding when it is set

Correct AnswerverifiedShow Answer

A binding price ceiling may not help all consumers, but it does not hurt any consumers.

Correct AnswerverifiedShow Answer

Figure 6-33 -Refer to Figure 6-33. Suppose a $4 per-unit tax is imposed on the sellers of this good. How many units of this good will be sold after the tax is imposed?

Correct AnswerverifiedWith a $4 per-unit t...View AnswerShow Answer

A price ceiling set below the equilibrium price causes a shortage in the market.

Correct AnswerverifiedShow Answer

Suppose the equilibrium price of a tube of toothpaste is $2, and the government imposes a price floor of $3 per tube. As a result of the price floor,

Correct AnswerverifiedShow Answer

Figure 6-22 -Refer to Figure 6-22. As the figure is drawn, who sends the tax payment to the government?

Correct AnswerverifiedShow Answer

When a tax is placed on the sellers of energy drinks, the

Correct AnswerverifiedShow Answer

Figure 6-22 -Refer to Figure 6-22. The effective price sellers receive after the tax is imposed is

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 6-32 -Refer to Figure 6-32. If the government set a price ceiling at $80, would there be a shortage or surplus, and how large would be the shortage/surplus?

Correct AnswerverifiedA price ceiling set at $80 wou...View AnswerShow Answer

Define a price floor.

Correct AnswerverifiedA price floor is a l...View AnswerShow Answer

Define a price ceiling.

Correct AnswerverifiedA price ceiling is a...View AnswerShow Answer

Figure 6-6 -Refer to Figure 6-6. Which of the following statements is not correct?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following statements is correct concerning the burden of a tax imposed on take-out food?

Correct AnswerverifiedShow Answer

Scenario 6-1 Suppose that demand in the market for good X is given by the equation and that supply in the market for good X is given by the equation -Refer to Scenario 6-1. If the government set a price floor at $13, would there be a shortage or surplus, and how large would be the shortage/surplus?

Correct AnswerverifiedA price floor set at...View AnswerShow Answer

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With a $4 per-unit t...
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A price ceiling set at $80 wou...
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A price floor is a l...
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A price ceiling is a...
View Answer

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A price floor set at...
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