Question 1

A minimum wage that is set below a market's equilibrium wage will result in an excess

Accepted Answer

A)   demand for labor, that is, unemployment.
B)   demand for labor, that is, a shortage of workers.
C)   supply of labor, that is, unemployment.
D)   None of the above is correct.E) B) and D)
F) All of the above

Question 2

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

Question 3

The burden of a luxury tax most likely falls more heavily on sellers because demand is more elastic and supply is more inelastic.

Accepted Answer

A) True 
 B)False

Question 4

The burden of a luxury tax falls

Accepted Answer

A)   more on the rich than on the middle class.
B)   more on the poor than on the rich.
C)   more on the middle class than on the rich.
D)   equally on the rich, the middle class, and the poor.E) A) and C)
F) None of the above

Question 5

Which of the following observations would be consistent with the imposition of a binding price ceiling on a market? After the price ceiling becomes effective,

Accepted Answer

A)   a smaller quantity of the good is bought and sold.
B)   a smaller quantity of the good is demanded.
C)   a larger quantity of the good is supplied.
D)   the price rises above the previous equilibrium.E) A) and B)
F) A) and C)

Question 6

A tax on sellers increases supply.

Accepted Answer

A) True 
 B)False

Question 7

Price is the rationing mechanism in a free,competitive market.

Accepted Answer

A) True 
 B)False

Question 8

The minimum wage,if it is binding,raises the incomes of

Accepted Answer

A)   no workers.
B)   only those workers who cannot find jobs.
C)   only those workers whose jobs would pay less than the minimum wage if it didn't exist.
D)   all workers.E) A) and D)
F) A) and C)

Question 9

Figure 6-19
 
-Refer to Figure 6-19.The effective price received by sellers after the tax is imposed is

Accepted Answer

A)   $3.
B)   $4.
C)   $5.
D)   $7.E) B) and C)
F) A) and D)

Question 10

The proportion of minimum-wage earners who are in families with incomes below the poverty line is

Accepted Answer

A)   less than one-third.
B)   between one-third and one-half.
C)   between one-half and two-thirds.
D)   greater than two-thirds.E) A) and B)
F) A) and C)

Question 11

The impact of the minimum wage depends on the skill and experience of the worker.

Accepted Answer

A) True 
 B)False

Question 12

Studies by economists have found that a 10 percent increase in the minimum wage decreases teenage employment 10 percent.

Accepted Answer

A) True 
 B)False

Question 13

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) All of the above
F) None of the above

Question 14

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) B) and D)
F) B) and C)

Question 15

At the equilibrium price,the quantity that buyers want to buy exactly equals the quantity that sellers want to sell.

Accepted Answer

A) True 
 B)False

Question 16

Figure 6-1

-Refer to Figure 6-1.The price ceiling shown in panel (a)

Accepted Answer

A)   is not binding.
B)   creates a surplus.
C)   creates a shortage.
D)   Both a)  and b)  are correct.E) None of the above
F) A) and D)

Question 17

Figure 6-17
 
-Refer to Figure 6-17.The price that buyers pay after the tax is imposed is

Accepted Answer

A)   $8.00.
B)   $9.00.
C)   $10.50.
D)   $12.00.E) A) and C)
F) A) and D)

Question 18

Figure 6-6
 
-Refer to Figure 6-6.In which of the following cases would sellers have to develop a rationing mechanism?

Accepted Answer

A)   a price ceiling set at $8
B)   a price ceiling set at $12
C)   a price floor set at $8
D)   a price floor set at $12E) B) and C)
F) None of the above

Question 19

If the government levies a $2 tax per DVD on buyers of DVDs,then the price received by sellers of DVDs would

Accepted Answer

A)   decrease by more than $2.
B)   decrease by exactly $2.
C)   decrease by less than $2.
D)   increase by an indeterminate amount.E) B) and C)
F) C) and D)

Question 20

Buyers and sellers always share the burden of a tax equally.

Accepted Answer

A) True 
 B)False

Exam 6: Supply, Demand, And Government Policies.

Figure 6-6 -Refer to Figure 6-6.In which of the following cases would sellers have to develop a rationing mechanism?

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If a price floor is not binding,then

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Figure 6-19 -Refer to Figure 6-19.The effective price received by sellers after the tax is imposed is

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The impact of the minimum wage depends on the skill and experience of the worker.

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A minimum wage that is set below a market's equilibrium wage will result in an excess

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The minimum wage,if it is binding,raises the incomes of

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Which of the following observations would be consistent with the imposition of a binding price ceiling on a market? After the price ceiling becomes effective,

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If the government levies a $2 tax per DVD on buyers of DVDs,then the price received by sellers of DVDs would

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

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The proportion of minimum-wage earners who are in families with incomes below the poverty line is

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The burden of a luxury tax most likely falls more heavily on sellers because demand is more elastic and supply is more inelastic.

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Price is the rationing mechanism in a free,competitive market.

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Studies by economists have found that a 10 percent increase in the minimum wage decreases teenage employment 10 percent.

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Buyers and sellers always share the burden of a tax equally.

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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 6-17 -Refer to Figure 6-17.The price that buyers pay after the tax is imposed is

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Figure 6-1 -Refer to Figure 6-1.The price ceiling shown in panel (a)

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A tax on sellers increases supply.

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The burden of a luxury tax falls

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At the equilibrium price,the quantity that buyers want to buy exactly equals the quantity that sellers want to sell.

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