A minimum wage that is set above a market's equilibrium wage will result in
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an excess supply of labor, that is, unemployment.
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If a government imposed price ceiling legally sets the price of beef below market equilibrium, which of the following will most likely happen?
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There will be a shortage of beef.
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Both price floors and price ceilings lead to
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a reduction in the quantity traded.
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A subsidy is defined as
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a payment to either the buyer or seller of a good or service, usually on a per-unit basis, when a good or service is purchased.
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A price ceiling set below an equilibrium price tends to cause persistent imbalances in the market because
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Quantity demanded exceeds quantity supplied but price cannot rise to remove the shortage.
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A payment the government makes to either the buyer or seller, usually on a per-unit basis, when a good or service is purchased or sold is called a
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subsidy.
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When a price ceiling is imposed below the equilibrium price of a commodity,
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a shortage of the good will develop.
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A price ceiling that sets the price of a good below market equilibrium will cause
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(1) an increase in quantity demanded of the good. (2) a decrease in quantity supplied of the good.
(3) a shortage of the good.
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A black market is
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a market that operates outside the legal system, either by selling illegal goods or by selling goods at illegal prices.
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A market that operates outside the legal system, either by selling illegal goods or by selling goods at illegal prices is referred to in economics as a
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black market.
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