Question 1

The minimum wage,if it is binding,raises the incomes of

Accepted Answer

A)   no workers.
B)   only those workers who cannot find jobs.
C)   only those workers whose jobs would pay less than the minimum wage if it didn't exist.
D)   all workers.E) A) and C)
F) A) and B)

Question 2

The demand for salt is inelastic,and the supply of salt is elastic.The demand for caviar is elastic,and the supply of caviar is inelastic.Suppose that a tax of $1 per pound is levied on the sellers of salt,and a tax of $1 per pound is levied on the buyers of caviar.We would expect that most of the burden of these taxes will fall on

Accepted Answer

A)   sellers of salt and the buyers of caviar.
B)   sellers of salt and the sellers of caviar.
C)   buyers of salt and the sellers of caviar.
D)   buyers of salt and the buyers of caviar.E) A) and C)
F) A) and D)

Question 3

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) None of the above
F) A) and B)

Question 4

Suppose that the demand for picture frames is highly inelastic,and the supply of picture frames is highly 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) A) and C)
F) C) and D)

Question 5

Which of the following is the most likely explanation for the imposition of a price ceiling on the market for milk?

Accepted Answer

A)   Policymakers have studied the effects of the price ceiling carefully,and they recognize that the price ceiling is advantageous for society as a whole.
B)   Buyers of milk,recognizing that the price ceiling is good for them,have pressured policymakers into imposing the price ceiling.
C)   Sellers of milk,recognizing that the price ceiling is good for them,have pressured policymakers into imposing the price ceiling.
D)   Buyers and sellers of milk have agreed that the price ceiling is good for both of them and have therefore pressured policymakers into imposing the price ceiling.E) B) and D)
F) C) and D)

Question 6

Which of the following is not a short-run effect of rent control on the housing market?

Accepted Answer

A)   reduced rents
B)   a large shortage
C)   a small increase in quantity demanded
D)   a small decrease in quantity suppliedE) A) and B)
F) All of the above

Question 7

A tax on buyers decreases demand.

Accepted Answer

A) True 
 B)False

Question 8

Figure 6-20 
-Refer to Figure 6-20.The price paid by buyers after the tax is imposed is

Accepted Answer

A)   $24.
B)   $21.
C)   $18.
D)   $16.E) B) and C)
F) A) and C)

Question 9

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

Accepted Answer

A)   no buyers actually benefit.
B)   some buyers benefit,but no buyers are harmed.
C)   some buyers benefit,and some buyers are harmed.
D)   all buyers benefit.E) None of the above
F) C) and D)

Question 10

Figure 6-21 
-Refer to Figure 6-22.The effective price that sellers receive after the tax is imposed is

Accepted Answer

A)   $5.
B)   $6.
C)   $7.
D)   $8.E) C) and D)
F) All of the above

Question 11

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

Accepted Answer

A) True 
 B)False

Question 12

Suppose that the demand for picture frames is highly inelastic,and the supply of picture frames is highly elastic.A tax of $1 per frame levied on picture frames will increase the price paid by buyers 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)

Question 13

Which of the following is correct? Price controls

Accepted Answer

A)   always help those they are designed to help.
B)   never help those they are designed to help.
C)   often hurt those they are designed to help.
D)   always hurt those they are designed to help.E) A) and B)
F) A) and C)

Question 14

Consider the market for watermelons.Buyers

Accepted Answer

A)   and sellers would lobby for a price ceiling.
B)   and sellers would lobby for a price floor.
C)   would lobby for a price ceiling,whereas sellers would lobby for a price floor.
D)   would lobby for a price floor,whereas sellers would lobby for a price ceiling.E) B) and D)
F) None of the above

Question 15

The goal of rent control is to

Accepted Answer

A)   facilitate controlled economic experiments in urban areas.
B)   help landlords by assuring them a low vacancy rate for their apartments.
C)   help the poor by assuring them an adequate supply of apartments.
D)   help the poor by making housing more affordable.E) A) and B)
F) A) and C)

Question 16

Figure 6-4 
-Refer to Figure 6-4.If the government set a price ceiling at $9,would there be a shortage or surplus,and how large would be the shortage/surplus?

Accepted Answer

There woul...

Question 17

Long lines and discrimination are examples of rationing methods that may naturally develop in response to a binding price ceiling.

Accepted Answer

A) True 
 B)False

Question 18

The mayor of Workerville proposes a local payroll tax to fund a new water park for the city.The mayor proposes to collect half the tax from workers and half the tax from firms.Workers will bear

Accepted Answer

A)   an equal share of the tax in comparison to firms.
B)   a greater share of the tax in comparison to firms.
C)   a smaller share of the tax in comparison to firms.
D)   All of the above are possible.E) B) and D)
F) All of the above

Question 19

A tax on the sellers of cameras encourages

Accepted Answer

A)   sellers to supply a smaller quantity at every price.
B)   buyers to demand a smaller quantity at every price.
C)   sellers to supply a larger quantity at every price.
D)   Both a and b are correct.E) B) and D)
F) All of the above

Question 20

Taxes levied on sellers and taxes levied on buyers are equivalent.

Accepted Answer

A) True 
 B)False

Exam 6: Supply,demand,and Government Policies

Suppose that the demand for picture frames is highly inelastic,and the supply of picture frames is highly 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

Taxes levied on sellers and taxes levied on buyers are equivalent.

Correct Answer
verified

A price floor is binding when it is set

Correct Answer
verified

Figure 6-20 -Refer to Figure 6-20.The price paid by buyers after the tax is imposed is

Correct Answer
verified

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

Correct Answer
verified

Figure 6-4 -Refer to Figure 6-4.If the government set a price ceiling at $9,would there be a shortage or surplus,and how large would be the shortage/surplus?

Correct Answer
verified
There woul...
View Answer

Suppose that the demand for picture frames is highly inelastic,and the supply of picture frames is highly elastic.A tax of $1 per frame levied on picture frames will increase the price paid by buyers of picture frames by

Correct Answer
verified

Correct Answer
verified

The mayor of Workerville proposes a local payroll tax to fund a new water park for the city.The mayor proposes to collect half the tax from workers and half the tax from firms.Workers will bear

Correct Answer
verified

The minimum wage,if it is binding,raises the incomes of

Correct Answer
verified

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

Correct Answer
verified

Long lines and discrimination are examples of rationing methods that may naturally develop in response to a binding price ceiling.

Correct Answer
verified

The goal of rent control is to

Correct Answer
verified

Consider the market for watermelons.Buyers

Correct Answer
verified

Figure 6-21 -Refer to Figure 6-22.The effective price that sellers receive after the tax is imposed is

Correct Answer
verified

Which of the following is not a short-run effect of rent control on the housing market?

Correct Answer
verified

Which of the following is the most likely explanation for the imposition of a price ceiling on the market for milk?

Correct Answer
verified

Which of the following is correct? Price controls

Correct Answer
verified

A tax on the sellers of cameras encourages

Correct Answer
verified

A tax on buyers decreases demand.

Correct Answer
verified

Exam 6: Supply,demand,and Government Policies

Suppose that the demand for picture frames is highly inelastic,and the supply of picture frames is highly 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

Taxes levied on sellers and taxes levied on buyers are equivalent.

Correct AnswerverifiedShow Answer

A price floor is binding when it is set

Correct AnswerverifiedShow Answer

Figure 6-20 -Refer to Figure 6-20.The price paid by buyers after the tax is imposed is

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 6-4 -Refer to Figure 6-4.If the government set a price ceiling at $9,would there be a shortage or surplus,and how large would be the shortage/surplus?

Correct AnswerverifiedThere woul...View AnswerShow Answer

Suppose that the demand for picture frames is highly inelastic,and the supply of picture frames is highly elastic.A tax of $1 per frame levied on picture frames will increase the price paid by buyers of picture frames by

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The mayor of Workerville proposes a local payroll tax to fund a new water park for the city.The mayor proposes to collect half the tax from workers and half the tax from firms.Workers will bear

Correct AnswerverifiedShow Answer

The minimum wage,if it is binding,raises the incomes of

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Long lines and discrimination are examples of rationing methods that may naturally develop in response to a binding price ceiling.

Correct AnswerverifiedShow Answer

The goal of rent control is to

Correct AnswerverifiedShow Answer

Consider the market for watermelons.Buyers

Correct AnswerverifiedShow Answer

Figure 6-21 -Refer to Figure 6-22.The effective price that sellers receive after the tax is imposed is

Correct AnswerverifiedShow Answer

Which of the following is not a short-run effect of rent control on the housing market?

Correct AnswerverifiedShow Answer

Which of the following is the most likely explanation for the imposition of a price ceiling on the market for milk?

Correct AnswerverifiedShow Answer

Which of the following is correct? Price controls

Correct AnswerverifiedShow Answer

A tax on the sellers of cameras encourages

Correct AnswerverifiedShow Answer

A tax on buyers decreases demand.

Correct AnswerverifiedShow Answer

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There woul...
View Answer

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