Question 1

If a tax is imposed on the buyers of a product, then the tax burden will fall entirely on the buyers.

Accepted Answer

A) True 
 B)False

Question 2

If the government levies a $5 tax per MP3 player on buyers of MP3 players, then the price paid by buyers of MP3 players would likely

Accepted Answer

A)  increase by more than $5.
B)  increase by exactly $5.
C)  increase by less than $5.
D)  decrease.E) All of the above
F) A) and D)

Question 3

Figure 6-26 
-Refer to Figure 6-26. The effective price received by sellers after the tax is imposed is

Accepted Answer

A)  $8.
B)  $16.
C)  $14.
D)  $12.E) A) and D)
F) A) and C)

Question 4

If the minimum wage exceeds the equilibrium wage, then

Accepted Answer

A)  the quantity demanded of labor will exceed the quantity supplied.
B)  the quantity supplied of labor will exceed the quantity demanded.
C)  the minimum wage will not be binding.
D)  there will be no unemployment.E) A) and B)
F) A) and C)

Question 5

Figure 6-36 
-Refer to Figure 6-36. If the government places a $2 tax in the market, the seller bears $1 of the tax burden.

Accepted Answer

A) True 
 B)False

Question 6

The imposition of a binding price floor on a market

Accepted Answer

A)  causes quantity demanded to be greater than quantity supplied.
B)  causes quantity demanded to be less than quantity supplied.
C)  causes quantity demanded to be equal to quantity supplied.
D)  causes a decrease in demand.E) A) and D)
F) B) and D)

Question 7

Which of the following statements about the effects of rent control is correct?

Accepted Answer

A)  The short-run effect of rent control is a surplus of apartments, and the long-run effect of rent control is a shortage of apartments.
B)  The short-run effect of rent control is a relatively small shortage of apartments, and the long-run effect of rent control is a larger shortage of apartments.
C)  In the long run, rent control leads to a shortage of apartments and an improvement in the quality of available apartments.
D)  The effects of rent control are very noticeable to the public in the short run because the primary effects of rent control occur very quickly.E) A) and C)
F) None of the above

Question 8

When OPEC raised the price of crude oil in the 1970s, it caused the

Accepted Answer

A)  demand for gasoline to increase.
B)  demand for gasoline to decrease.
C)  supply of gasoline to increase.
D)  supply of gasoline to decrease.E) A) and D)
F) B) and C)

Question 9

Figure 6-31  ​
-Refer to Figure 6-31. Suppose that a price ceiling is imposed in this market at a price of $30. The effect of this price ceiling would be ​

Accepted Answer

A)  nonbinding and cause a shortage of 50 units.
B)  ​binding and cause a shortage of 50 units.
C)  ​binding and cause a shortage of 20 units.
D)  nonbinding and have no effect on the market.E) All of the above
F) None of the above

Question 10

Suppose there is currently a tax of $50 per ticket on airline tickets. Buyers of airline tickets are required to pay the tax to the government. If the tax is reduced from $50 per ticket to $20 per ticket, then the

Accepted Answer

A)  demand curve will shift upward by $30, and the price paid by buyers will decrease by less than $30.
B)  demand curve will shift upward by $30, and the price paid by buyers will decrease by $30.
C)  supply curve will shift downward by $30, and the effective price received by sellers will increase by less than $30.
D)  supply curve will shift downward by $30, and the effective price received by sellers will increase by $30.E) All of the above
F) A) and D)

Question 11

When a price floor is binding, is the price floor set above or below the market equilibrium price?

Accepted Answer

A binding price floo...

Question 12

Figure 6-31 
-Refer to Figure 6-31. If the government set a price ceiling at $15, would there be a shortage or surplus, and how large would be the shortage/surplus?

Accepted Answer

A price ceiling set at $15 wou...

Question 13

Suppose the equilibrium price of a physical examination ("physical")  by a doctor is $200, and the government imposes a price ceiling of $150 per physical. As a result of the price ceiling,

Accepted Answer

A)  the quantity of physicals demanded increases.
B)  there is shortage of physicals.
C)  the quantity of physicals supplied decreases.
D)  All of the above are correct.E) None of the above
F) A) and B)

Question 14

A binding minimum wage tends to

Accepted Answer

A)  cause a labor surplus.
B)  cause unemployment.
C)  have the greatest impact in the market for teenage labor.
D)  All of the above are correct.E) A) and B)
F) None of the above

Question 15

A $1.50 tax levied on the buyers of pomegranate juice will shift the demand curve

Accepted Answer

A)  upward by exactly $1.50.
B)  upward by less than $1.50.
C)  downward by exactly $1.50.
D)  downward by less than $1.50.E) A) and B)
F) All of the above

Question 16

Table 6-1 
-Refer to Table 6-1. Suppose the government imposes a price ceiling of $70 on this market. What will be the size of the shortage in this market?

Accepted Answer

A)  0 units
B)  400 units
C)  600 units
D)  1000 unitsE) B) and D)
F) C) and D)

Question 17

Figure 6-26 
-Refer to Figure 6-26. The price paid by buyers after the tax is imposed is

Accepted Answer

A)  $8.
B)  $16.
C)  $14.
D)  $12.E) A) and C)
F) A) and B)

Question 18

The price received by sellers in a market will increase if the government decreases a

Accepted Answer

A)  binding price floor in that market.
B)  binding price ceiling in that market.
C)  tax on the good sold in that market.
D)  None of the above is correct.E) All of the above
F) A) and B)

Question 19

Figure 6-29
Suppose the government imposes a $2 on this market. 
-Refer to Figure 6-29. 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) A) and C)
F) C) and D)

Question 20

Figure 6-21 
-Refer to Figure 6-21. In the after-tax equilibrium, how much revenue does the government collect from the tax on this good?

Accepted Answer

A)  $210
B)  $345
C)  $420
D)  $480E) All of the above
F) A) and B)

Exam 6: Supply, Demand, and Government Policies

A binding minimum wage tends to

Correct Answer
verified

When OPEC raised the price of crude oil in the 1970s, it caused the

Correct Answer
verified

Suppose there is currently a tax of $50 per ticket on airline tickets. Buyers of airline tickets are required to pay the tax to the government. If the tax is reduced from $50 per ticket to $20 per ticket, then the

Correct Answer
verified

The imposition of a binding price floor on a market

Correct Answer
verified

If the government levies a $5 tax per MP3 player on buyers of MP3 players, then the price paid by buyers of MP3 players would likely

Correct Answer
verified

Figure 6-21 -Refer to Figure 6-21. In the after-tax equilibrium, how much revenue does the government collect from the tax on this good?

Correct Answer
verified

Figure 6-36 -Refer to Figure 6-36. If the government places a $2 tax in the market, the seller bears $1 of the tax burden.

Correct Answer
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When a price floor is binding, is the price floor set above or below the market equilibrium price?

Correct Answer
verified
A binding price floo...
View Answer

Figure 6-26 -Refer to Figure 6-26. The effective price received by sellers after the tax is imposed is

Correct Answer
verified

Suppose the equilibrium price of a physical examination ("physical") by a doctor is $200, and the government imposes a price ceiling of $150 per physical. As a result of the price ceiling,

Correct Answer
verified

Table 6-1 -Refer to Table 6-1. Suppose the government imposes a price ceiling of $70 on this market. What will be the size of the shortage in this market?

Correct Answer
verified

The price received by sellers in a market will increase if the government decreases a

Correct Answer
verified

If a tax is imposed on the buyers of a product, then the tax burden will fall entirely on the buyers.

Correct Answer
verified

Correct Answer
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Figure 6-31 -Refer to Figure 6-31. Suppose that a price ceiling is imposed in this market at a price of $30. The effect of this price ceiling would be

Correct Answer
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If the minimum wage exceeds the equilibrium wage, then

Correct Answer
verified

Figure 6-26 -Refer to Figure 6-26. The price paid by buyers after the tax is imposed is

Correct Answer
verified

Figure 6-31 -Refer to Figure 6-31. If the government set a price ceiling at $15, would there be a shortage or surplus, and how large would be the shortage/surplus?

Correct Answer
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A price ceiling set at $15 wou...
View Answer

Which of the following statements about the effects of rent control is correct?

Correct Answer
verified

A $1.50 tax levied on the buyers of pomegranate juice will shift the demand curve

Correct Answer
verified

Exam 6: Supply, Demand, and Government Policies

A binding minimum wage tends to

Correct AnswerverifiedShow Answer

When OPEC raised the price of crude oil in the 1970s, it caused the

Correct AnswerverifiedShow Answer

Suppose there is currently a tax of $50 per ticket on airline tickets. Buyers of airline tickets are required to pay the tax to the government. If the tax is reduced from $50 per ticket to $20 per ticket, then the

Correct AnswerverifiedShow Answer

The imposition of a binding price floor on a market

Correct AnswerverifiedShow Answer

If the government levies a $5 tax per MP3 player on buyers of MP3 players, then the price paid by buyers of MP3 players would likely

Correct AnswerverifiedShow Answer

Figure 6-21 -Refer to Figure 6-21. In the after-tax equilibrium, how much revenue does the government collect from the tax on this good?

Correct AnswerverifiedShow Answer

Figure 6-36 -Refer to Figure 6-36. If the government places a $2 tax in the market, the seller bears $1 of the tax burden.

Correct AnswerverifiedShow Answer

When a price floor is binding, is the price floor set above or below the market equilibrium price?

Correct AnswerverifiedA binding price floo...View AnswerShow Answer

Figure 6-26 -Refer to Figure 6-26. The effective price received by sellers after the tax is imposed is

Correct AnswerverifiedShow Answer

Suppose the equilibrium price of a physical examination ("physical") by a doctor is $200, and the government imposes a price ceiling of $150 per physical. As a result of the price ceiling,

Correct AnswerverifiedShow Answer

Table 6-1 -Refer to Table 6-1. Suppose the government imposes a price ceiling of $70 on this market. What will be the size of the shortage in this market?

Correct AnswerverifiedShow Answer

The price received by sellers in a market will increase if the government decreases a

Correct AnswerverifiedShow Answer

If a tax is imposed on the buyers of a product, then the tax burden will fall entirely on the buyers.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 6-31 ​ -Refer to Figure 6-31. Suppose that a price ceiling is imposed in this market at a price of $30. The effect of this price ceiling would be ​

Correct AnswerverifiedShow Answer

If the minimum wage exceeds the equilibrium wage, then

Correct AnswerverifiedShow Answer

Figure 6-26 -Refer to Figure 6-26. The price paid by buyers after the tax is imposed is

Correct AnswerverifiedShow Answer

Figure 6-31 -Refer to Figure 6-31. If the government set a price ceiling at $15, would there be a shortage or surplus, and how large would be the shortage/surplus?

Correct AnswerverifiedA price ceiling set at $15 wou...View AnswerShow Answer

Which of the following statements about the effects of rent control is correct?

Correct AnswerverifiedShow Answer

A $1.50 tax levied on the buyers of pomegranate juice will shift the demand curve

Correct AnswerverifiedShow Answer

Correct Answer
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A binding price floo...
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Figure 6-31 -Refer to Figure 6-31. Suppose that a price ceiling is imposed in this market at a price of $30. The effect of this price ceiling would be

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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A price ceiling set at $15 wou...
View Answer

Correct Answer
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Correct Answer
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