Question 1

Figure 6-26 
-Refer to Figure 6-26. A price ceiling set at $30 would create a shortage of 20 units.

Accepted Answer

A) True 
 B)False

Question 2

The tax incidence

Accepted Answer

A)  is the manner in which the burden of a tax is shared among participants in a market.
B)  can be shifted to the buyer by imposing the tax on the buyers of a product in a market.
C)  can be shifted to the seller by imposing the tax on the sellers of a product in a market.
D)  All of the above are correct.E) A) and B)
F) None of the above

Question 3

The imposition of a binding price ceiling on a market causes quantity demanded to be

Accepted Answer

A)  greater than quantity supplied.
B)  less than quantity supplied.
C)  equal to quantity supplied.
D)  Both a)  and b)  are possible.E) A) and C)
F) B) and C)

Question 4

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 5

Figure 6-18 
-Refer to Figure 6-18. 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) B) and D)
F) A) and C)

Question 6

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 C)
F) A) and D)

Question 7

The goal of the minimum wage is to ensure workers a minimally adequate standard of living.

Accepted Answer

A) True 
 B)False

Question 8

When a binding price floor is imposed on a market to benefit sellers,

Accepted Answer

A)  no sellers actually benefit.
B)  some sellers benefit, but no sellers are harmed.
C)  some sellers benefit, and some sellers are harmed.
D)  all sellers benefit.E) A) and D)
F) A) and C)

Question 9

Which of the following is not an example of a public policy?

Accepted Answer

A)  rent-control laws
B)  minimum-wage laws
C)  taxes
D)  equilibrium lawsE) A) and B)
F) B) and D)

Question 10

Table 6-1
   Price  Quantity  Denanded  Quantity  Sugplied $[12120$1102$284$366$448$5210$6012\begin{array} { | c | c | c | } \hline 	ext { Price } & \begin{array} { c } 	ext { Quantity } \	ext { Denanded }\end{array} & \begin{array} { c } 	ext { Quantity } \	ext { Sugplied }\end{array} \\hline \$ [ 12 & 12 & 0 \\hline \$ 1 & 10 & 2 \\hline \$ 2 & 8 & 4 \\hline \$ 3 & 6 & 6 \\hline \$ 4 & 4 & 8 \\hline \$ 5 & 2 & 10 \\hline \$ 6 & 0 & 12 \\hline\end{array} Price $[12$1$2$3$4$5$6​ Quantity  Denanded ​121086420​ Quantity  Sugplied ​024681012​​ 
-Refer to Table 6-1. Suppose the government imposes a price floor of $5 on this market. What will be the size of the surplus in this market?

Accepted Answer

A)  0 units
B)  2 units
C)  8 units
D)  10 units E) A) and B)
F) A) and C)

Question 11

Figure 6-20 
-Refer to Figure 6-20. The per-unit burden of the tax on buyers of the good is

Accepted Answer

A)  $2.
B)  $4.
C)  $6.
D)  $8.E) All of the above
F) A) and B)

Question 12

A tax imposed on the sellers of a good will lower the

Accepted Answer

A)  price paid by buyers and lower the equilibrium quantity.
B)  price paid by buyers and raise the equilibrium quantity.
C)  effective price received by sellers and lower the equilibrium quantity.
D)  effective price received by sellers and raise the equilibrium quantity.E) A) and C)
F) A) and D)

Question 13

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) B) and C)
F) All of the above

Question 14

To say that a price floor is binding is to say that the price floor

Accepted Answer

A)  results in a shortage.
B)  is set below the equilibrium price.
C)  causes quantity supplied to exceed quantity demanded.
D)  All of the above are correct.E) A) and C)
F) A) and D)

Question 15

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

Accepted Answer

A) True 
 B)False

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

Table 6-3
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 $2 above the equilibrium price in this market.   price  Quantity  Denanded  Quantity  Suppplied $0150$1133$2116$399$4712$5515$6318\begin{array} { | c | c | c } \hline 	ext { price } & \begin{array} { c } 	ext { Quantity } \	ext { Denanded }\end{array} & \begin{array} { c } 	ext { Quantity } \	ext { Suppplied }\end{array} \\hline \$ 0 & 15 & 0 \\hline \$ 1 & 13 & 3 \\hline \$ 2 & 11 & 6 \\hline \$ 3 & 9 & 9 \\hline \$ 4 & 7 & 12 \\hline \$ 5 & 5 & 15 \\hline \$ 6 & 3 & 18 \\hline\end{array} price $0$1$2$3$4$5$6​ Quantity  Denanded ​1513119753​ Quantity  Suppplied ​0369121518​​ 
-Refer to Table 6-3. How many units of the good are sold after the imposition of the price floor?

Accepted Answer

A)  5
B)  9
C)  10
D)  15 E) C) and D)
F) B) and D)

Question 18

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 19

Figure 6-20 
-Refer to Figure 6-20. Suppose sellers, rather than buyers, were required to pay this tax (in the same amount per unit as shown in the graph) . Relative to the tax on buyers, the tax on sellers would result in

Accepted Answer

A)  buyers bearing the same share of the tax burden.
B)  sellers bearing the same share of the tax burden.
C)  the same amount of tax revenue for the government.
D)  All of the above are correct.E) All of the above
F) A) and D)

Question 20

A price ceiling is

Accepted Answer

A)  often imposed on markets in which "cutthroat competition" would prevail without a price ceiling.
B)  a legal maximum on the price at which a good can be sold.
C)  often imposed when sellers of a good are successful in their attempts to convince the government that the market outcome is unfair without a price ceiling.
D)  All of the above are correct.E) A) and B)
F) A) and C)

Exam 6: Supply, Demand, and Government Policies

A price ceiling is

Correct Answer
verified

Figure 6-20 -Refer to Figure 6-20. Suppose sellers, rather than buyers, were required to pay this tax (in the same amount per unit as shown in the graph) . Relative to the tax on buyers, the tax on sellers would result in

Correct Answer
verified

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

Correct Answer
verified

To say that a price floor is binding is to say that the price floor

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

Correct Answer
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Figure 6-20 -Refer to Figure 6-20. The per-unit burden of the tax on buyers of the good is

Correct Answer
verified

The imposition of a binding price ceiling on a market causes quantity demanded to be

Correct Answer
verified

Figure 6-26 -Refer to Figure 6-26. A price ceiling set at $30 would create a shortage of 20 units.

Correct Answer
verified

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

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

Correct Answer
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Correct Answer
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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
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Which of the following is not an example of a public policy?

Correct Answer
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When a binding price floor is imposed on a market to benefit sellers,

Correct Answer
verified

A tax imposed on the sellers of a good will lower the

Correct Answer
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The tax incidence

Correct Answer
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Correct Answer
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Congress intended that

Correct Answer
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Figure 6-18 -Refer to Figure 6-18. As the figure is drawn, who sends the tax payment to the government?

Correct Answer
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The goal of the minimum wage is to ensure workers a minimally adequate standard of living.

Correct Answer
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Exam 6: Supply, Demand, and Government Policies

A price ceiling is

Correct AnswerverifiedShow Answer

Figure 6-20 -Refer to Figure 6-20. Suppose sellers, rather than buyers, were required to pay this tax (in the same amount per unit as shown in the graph) . Relative to the tax on buyers, the tax on sellers would result in

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

To say that a price floor is binding is to say that the price floor

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 6-20 -Refer to Figure 6-20. The per-unit burden of the tax on buyers of the good is

Correct AnswerverifiedShow Answer

The imposition of a binding price ceiling on a market causes quantity demanded to be

Correct AnswerverifiedShow Answer

Figure 6-26 -Refer to Figure 6-26. A price ceiling set at $30 would create a shortage of 20 units.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Which of the following is not an example of a public policy?

Correct AnswerverifiedShow Answer

When a binding price floor is imposed on a market to benefit sellers,

Correct AnswerverifiedShow Answer

A tax imposed on the sellers of a good will lower the

Correct AnswerverifiedShow Answer

The tax incidence

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Congress intended that

Correct AnswerverifiedShow Answer

Figure 6-18 -Refer to Figure 6-18. As the figure is drawn, who sends the tax payment to the government?

Correct AnswerverifiedShow Answer

The goal of the minimum wage is to ensure workers a minimally adequate standard of living.

Correct AnswerverifiedShow Answer

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