Ch 6 Econ

17 June 2024
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question
When a tax is levied on sellers of tea, A. the well-being of both sellers and buyers of tea is unaffected. B. sellers of tea are made worse off, and the well-being of buyers is unaffected. C. sellers of tea are made worse off, and buyers of tea are made better off. D. both sellers and buyers of tea are made worse off.
answer
D
question
Price controls are usually enacted A. as a means of raising revenue for public purposes. B. when policymakers believe that the market price of a good or service is unfair to buyers or sellers. C. when policymakers detect inefficiencies in a market. D. All of the above are correct.
answer
B
question
A tax imposed on the sellers of a good will raise the 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.
answer
A
question
If the government removes a binding price ceiling from a market, then the price received by sellers will A. decrease, and the quantity sold in the market will decrease. B. decrease, and the quantity sold in the market will increase. C. increase, and the quantity sold in the market will decrease. D. increase, and the quantity sold in the market will increase.
answer
D
question
In a free, competitive market, what is the rationing mechanism? A. seller bias B. buyer bias C. government law D. price
answer
D
question
A price ceiling is 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.
answer
B
question
A price floor will be binding only if it is set A. equal to the equilibrium price. B. above the equilibrium price. C. below the equilibrium price. D. either above or below the equilibrium price.
answer
B
question
Suppose the government has imposed a price ceiling on laptop computers. Which of the following events could transform the price ceiling from one that is not binding into one that is binding? A. Improvements in production technology reduce the costs of producing laptop computers. B. The number of firms selling laptop computers decreases. C. Consumers' income decreases, and laptop computers are a normal good. D. The number of consumers buying laptop computers decreases.
answer
B
question
When a tax is placed on the sellers of cell phones, the size of the cell phone market A. and the effective price received by sellers both increase. B. increases, but the effective price received by sellers decreases. C. decreases, but the effective price received by sellers increases. D. and the effective price received by sellers both decrease.
answer
D
question
Which of the following is correct? A. Workers determine the supply of labor, and firms determine the demand for labor. B. Workers determine the demand for labor, and firms determine the supply of labor. C. The labor market is a single market for all different types of workers. D. The price of the product produced by labor adjusts to balance the supply of labor and the demand for labor.
answer
A
question
Refer to Figure 6-2. The price ceiling A. causes a shortage of 45 units of the good. B. makes it necessary for sellers to ration the good. C. is not binding because it is set below the equilibrium price. D. Both a) and b) are correct.
answer
B
question
Refer to Figure 6-2. The price ceiling A. is binding. B. causes a shortage. C. causes the quantity demanded to exceed the quantity supplied. D. All of the above are correct.
answer
D
question
Refer to Figure 6-4. A government-imposed price of $6 in this market could be an example of a (i) binding price ceiling. (ii) non-binding price ceiling. (iii) binding price floor. (iv) non-binding price floor. A. (i) only B. (ii) only C. (i) and (iv) only D. (ii) and (iii) only
answer
C
question
Refer to Figure 6-4. Which of the following statements is not correct? A. When the price is $10, quantity supplied equals quantity demanded. B. When the price is $6, there is a surplus of 8 units. C. When the price is $12, there is a surplus of 4 units. D. When the price is $16, quantity supplied exceeds quantity demanded by 12 units.
answer
B
question
Refer to Figure 6-14. The effective price that sellers receive after the tax is imposed is A. $6. B. $10. C. $16. D. $24.
answer
B
question
Refer to Figure 6-14. The amount of the tax per unit is A. $6. B. $8. C. $14. D. $18.
answer
C
question
Refer to Figure 6-14. The per-unit burden of the tax on sellers is A. $6. B. $8. C. $10. D. $14.
answer
A
question
Refer to Figure 6-15. Suppose a tax of $2 per unit is imposed on this market. How much will buyers pay per unit after the tax is imposed? A. $3 B. between $3 and $5 C. between $5 and $7 D. $7
answer
C
question
Refer to Figure 6-15. Suppose a tax of $2 per unit is imposed on this market. How much will sellers receive per unit after the tax is imposed? A. $3 B. between $3 and $5 C. between $5 and $7 D. $7
answer
B
question
Refer to Figure 6-15. Suppose a tax of $2 per unit is imposed on this market. Which of the following is correct? A. One-fourth of the burden of the tax will fall on buyers, and three-fourths of the burden of the tax will fall on sellers. B. One-third of the burden of the tax will fall on buyers, and two-thirds of the burden of the tax will fall on sellers. C. One-half of the burden of the tax will fall on buyers ,and one-half of the burden of the tax will fall on sellers. D. Two-thirds of the burden of the tax will fall on buyers, and one-third of the burden of the tax will fall on sellers.
answer
C