FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 6: Government Actions in Markets

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 91

Multiple Choice

Review LaterAdd Note

Review Later

-The figure above shows the market for milk in Cowland. If a subsidy paid to producers of $1 per gallon of milk is introduced, what is the price that consumers pay?

A) $3.00 a gallon
B) between $3.00 and $4.00 per gallon
C) $4.00 a gallon
D) between $4.00 and $5.00 per gallon

Correct Answer

verified

Show Answer

Question 92

Essay

Review LaterAdd Note

Review Later

-The figure above illustrates the current market for apartments in Washington, D.C. a) If the local government imposes a price ceiling of $1,500 per month, is there a shortage? If so, how much, if not, why not? b) If the local government imposes a price ceiling of $900 per month, is there a shortage? If so, how much, if not, why not?

Correct Answer

verified

a) There is not a shortage. The equilibr...

View Answer

Show Answer

Question 93

Multiple Choice

Review LaterAdd Note

-The table gives the demand and supply schedules for cookies. The government now levies a $0.30 tax on cookies. As a result, the price of a packet of cookies increases by ________ and the tax revenue collected is ________ a week.

A price ________ is a regulated ________ that must be set below the equilibrium price to have an effect.

-In the above figure, a minimum wage of ________ would result in employment of ________.

Will an increase in the minimum wage create more unemployment if the supply and demand for labor are highly elastic or highly inelastic?

Suppose the government imposes a price ceiling that is lower than the equilibrium price. Discuss the effect, if any, on the price and quantity if the government later removes the price ceiling.

What is search activity and how does it influence consumer surplus when a rent ceiling creates a housing shortage?

-You are in the business of producing and selling hamburgers, french fries, pizza, and ice cream. The mayor plans to impose a tax on one of these products. Based on the elasticities in the above table, on which of these goods would your customers most prefer to be taxed?

-In the above figure, if the minimum wage is set at $6 per hour, the level of unemployment is ________ hours per week is

-The market for unskilled labor is illustrated in the figure above. The market is in equilibrium and then a minimum wage of $8 per hour is imposed. Unemployment will equal

One way to assure that poor people will have a plentiful supply of affordable housing available to them is by imposing rent ceilings.

-Which of the following is a likely outcome of rent ceilings?

A price ceiling set below the equilibrium price ________ search activity and ________ the use of black markets.

-In the above figure, who pays the larger share of the tax?

Explain why in cities such as New York City that have rent ceiling laws, so many people who work in the city commute from outside the city.

-The figure above shows the market for milk in Cowland. If a subsidy paid to producers of $1 per gallon of milk is introduced, how many gallons are sold per year?

Suppose the local government places a sales tax on hotel rooms and that the demand for these rooms is elastic while the supply is perfectly inelastic. The tax incidence is such that the tax will be paid by

The minimum wage in 2008 was $6.55 cents until July 2008 when it was raised to $7.25. If the minimum wage in June was below the equilibrium wage and the increased wage in July was above the equilibrium wage, then

In order to have an effect, a price ceiling must be set