Question 1

Rent-control laws dictate a minimum rent that landlords may charge tenants.

Accepted Answer

A) True 
 B)False

Question 2

A price ceiling set above the equilibrium price causes quantity demanded to exceed quantity supplied.

Accepted Answer

A) True 
 B)False

Question 3

Figure 6-27 
-Refer to Figure 6-27.If the government places a $2 tax in the market,the buyer bears $2 of the tax burden.

Accepted Answer

A) True 
 B)False

Question 4

There are several criticisms of the minimum wage.Which of the following is not one of those criticisms? The minimum wage

Accepted Answer

A)   often hurts those people who it is intended to help.
B)   results in an excess supply of low-skilled labor.
C)   prevents some unskilled workers from getting needed on-the-job training.
D)   fails to raise the wage of any employed person.E) B) and D)
F) None of the above

Question 5

If a price floor is not binding,then it will have no effect on the market.

Accepted Answer

A) True 
 B)False

Question 6

If the government removes a tax on a good,then the quantity of the good sold will

Accepted Answer

A)   increase.
B)   decrease.
C)   not change.
D)   All of the above are possible.E) A) and B)
F) C) and D)

Question 7

Figure 6-13 
-Refer to Figure 6-13.In this market,a minimum wage of $7.25 creates a labor

Accepted Answer

A)   shortage of 2,250 workers.
B)   shortage of 4,500 workers.
C)   surplus of 2,250 workers.
D)   surplus of 4,500 workers.E) A) and B)
F) A) and C)

Question 8

If a price floor is not binding,then

Accepted Answer

A)   there will be a surplus in the market.
B)   there will be a shortage in the market.
C)   there will be no effect on the market price or quantity sold.
D)   the market will be less efficient than it would be without the price floor.E) None of the above
F) All of the above

Question 9

Figure 6-6 
-Refer to Figure 6-6.If the government imposes a price ceiling of $8 on this market,then there will be

Accepted Answer

A)   no shortage.
B)   a shortage of 10 units.
C)   a shortage of 20 units.
D)   a shortage of 40 units.E) A) and B)
F) A) and C)

Question 10

When a tax is imposed on the sellers of a good,the supply curve shifts

Accepted Answer

A)   upward by the amount of the tax.
B)   downward by the amount of the tax.
C)   upward by less than the amount of the tax.
D)   downward by less than the amount of the tax.E) C) and D)
F) A) and B)

Question 11

Figure 6-21 
-Refer to Figure 6-21.The equilibrium price in the market before the tax is imposed is

Accepted Answer

A)   $1.
B)   $2.
C)   $5.
D)   $6.E) A) and B)
F) None of the above

Question 12

Renters of rent-controlled apartments will likely benefit from both lower rents and higher quality of apartments.

Accepted Answer

A) True 
 B)False

Question 13

Figure 6-2 
-Refer to Figure 6-2.The price ceiling causes a

Accepted Answer

A)   surplus of 40 units.
B)   surplus of 85 units.
C)   shortage of 45 units.
D)   shortage of 85 units.E) A) and D)
F) A) and C)

Question 14

Figure 6-13 
-Refer to Figure 6-13.In this market,a minimum wage of $7.25 is

Accepted Answer

A)   binding and creates a labor shortage.
B)   binding and creates unemployment.
C)   nonbinding and creates a labor shortage.
D)   nonbinding and creates neither a labor shortage nor unemployment.E) All of the above
F) A) and B)

Question 15

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) All of the above
F) A) and D)

Question 16

Figure 6-24
Suppose the government imposes a $2 on this market. 
-Refer to Figure 6-24.The buyers will bear a higher share of the tax burden than sellers if the demand is

Accepted Answer

A)   D1,and the supply is S1.
B)   D2,and the supply is S1.
C)   D1,and the supply is S2.
D)   D2,and the supply is S2.E) A) and D)
F) All of the above

Question 17

Figure 6-25
 
-Refer to Figure 6-25.In which market will the majority of the tax burden fall on buyers?

Accepted Answer

A)   market (a) 
B)   market (b) 
C)   market (c) 
D)   All of the above are correct.E) B) and C)
F) A) and D)

Question 18

Figure 6-24
Suppose the government imposes a $2 on this market. 
-Refer to Figure 6-24.Suppose D1 represents the demand curve for gasoline in both the short run and long run,S1 represents the supply curve for gasoline in the short run,and S2 represents the supply curve for gasoline in the long run.After the imposition of the $2,

Accepted Answer

A)   buyers bear a higher burden of the tax in the short run than in the long run.
B)   sellers bear a higher burden of the tax in the short run than in the long run.
C)   buyers and sellers bear an equal burden of the tax in both the short run and long run.
D)   buyers and sellers bear an equal burden of the tax in the short run,but buyers bear a higher burden of the tax in the long run.E) B) and C)
F) All of the above

Question 19

FICA is an example of a payroll tax,which is a tax on the wages that firms pay their workers.

Accepted Answer

A) True 
 B)False

Question 20

A tax on sellers shifts the supply curve but not the demand curve.

Accepted Answer

A) True 
 B)False

Exam 6: Supply,demand,and Government Policies

Figure 6-27 -Refer to Figure 6-27.If the government places a $2 tax in the market,the buyer bears $2 of the tax burden.

Correct Answer
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Figure 6-2 -Refer to Figure 6-2.The price ceiling causes a

Correct Answer
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There are several criticisms of the minimum wage.Which of the following is not one of those criticisms? The minimum wage

Correct Answer
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If a price floor is not binding,then

Correct Answer
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Renters of rent-controlled apartments will likely benefit from both lower rents and higher quality of apartments.

Correct Answer
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Rent-control laws dictate a minimum rent that landlords may charge tenants.

Correct Answer
verified

Figure 6-21 -Refer to Figure 6-21.The equilibrium price in the market before the tax is imposed is

Correct Answer
verified

When a tax is imposed on the sellers of a good,the supply curve shifts

Correct Answer
verified

If the government removes a tax on a good,then the quantity of the good sold will

Correct Answer
verified

Correct Answer
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A price ceiling set above the equilibrium price causes quantity demanded to exceed quantity supplied.

Correct Answer
verified

FICA is an example of a payroll tax,which is a tax on the wages that firms pay their workers.

Correct Answer
verified

Figure 6-6 -Refer to Figure 6-6.If the government imposes a price ceiling of $8 on this market,then there will be

Correct Answer
verified

A tax on sellers shifts the supply curve but not the demand curve.

Correct Answer
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If a price floor is not binding,then it will have no effect on the market.

Correct Answer
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Figure 6-25 -Refer to Figure 6-25.In which market will the majority of the tax burden fall on buyers?

Correct Answer
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Figure 6-13 -Refer to Figure 6-13.In this market,a minimum wage of $7.25 is

Correct Answer
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Figure 6-24 Suppose the government imposes a $2 on this market. -Refer to Figure 6-24.The buyers will bear a higher share of the tax burden than sellers if the demand is

Correct Answer
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Figure 6-13 -Refer to Figure 6-13.In this market,a minimum wage of $7.25 creates a labor

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

Correct Answer
verified

Exam 6: Supply,demand,and Government Policies

Figure 6-27 -Refer to Figure 6-27.If the government places a $2 tax in the market,the buyer bears $2 of the tax burden.

Correct AnswerverifiedShow Answer

Figure 6-2 -Refer to Figure 6-2.The price ceiling causes a

Correct AnswerverifiedShow Answer

There are several criticisms of the minimum wage.Which of the following is not one of those criticisms? The minimum wage

Correct AnswerverifiedShow Answer

If a price floor is not binding,then

Correct AnswerverifiedShow Answer

Renters of rent-controlled apartments will likely benefit from both lower rents and higher quality of apartments.

Correct AnswerverifiedShow Answer

Rent-control laws dictate a minimum rent that landlords may charge tenants.

Correct AnswerverifiedShow Answer

Figure 6-21 -Refer to Figure 6-21.The equilibrium price in the market before the tax is imposed is

Correct AnswerverifiedShow Answer

When a tax is imposed on the sellers of a good,the supply curve shifts

Correct AnswerverifiedShow Answer

If the government removes a tax on a good,then the quantity of the good sold will

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A price ceiling set above the equilibrium price causes quantity demanded to exceed quantity supplied.

Correct AnswerverifiedShow Answer

FICA is an example of a payroll tax,which is a tax on the wages that firms pay their workers.

Correct AnswerverifiedShow Answer

Figure 6-6 -Refer to Figure 6-6.If the government imposes a price ceiling of $8 on this market,then there will be

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A tax on sellers shifts the supply curve but not the demand curve.

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If a price floor is not binding,then it will have no effect on the market.

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Figure 6-25 -Refer to Figure 6-25.In which market will the majority of the tax burden fall on buyers?

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Figure 6-13 -Refer to Figure 6-13.In this market,a minimum wage of $7.25 is

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Figure 6-24 Suppose the government imposes a $2 on this market. -Refer to Figure 6-24.The buyers will bear a higher share of the tax burden than sellers if the demand is

Correct AnswerverifiedShow Answer

Figure 6-13 -Refer to Figure 6-13.In this market,a minimum wage of $7.25 creates a labor

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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