Exam 5: Using Supply and Demand

Refer to the following graph. In New York City, the rent on many apartments is set below market rates. As a result, many people find that the only way to obtain an apartment is to make illegal payments to landlords. If Pc is the controlled rent, a best estimate of such "key" money is shown as:

Suppose that a consumer has a health insurance program with co-payments of $10 per doctor visit. If the consumer purchases 6 doctor visits and the bill charged by the doctor for 6 visits is $360, the portion of this cost covered by a third-party payer is:

A number of states have a minimum wage that is higher than the federal minimum. In those states that impose such a minimum wage, it is more likely that the minimum wage acts as a binding:

Suppose that initially, demand is given by the equation Qd = 48 − 4P. If, as a result of an increase in income, the quantity demanded increases by 12 at every price, the new demand equation would be:

Refer to the graph shown. If buyers must pay $5, quantity demanded will equal:

A Wall Street Journal headline reads: "Cigar Shortage Draws New Brands into Market." The shortage resulted from a renewed interest in smoking cigars. What best describes the facts behind the headline?

Refer to the following graph. With a tariff of $10 a blouse on imported silk blouses from China, the revenue the government would collect from the import of silk blouses from China would be:

When an effective price ceiling is removed, we would expect the price of the good to:

Suppose that a consumer has a health insurance program with $10 co-payment per doctor visit. If the consumer purchases 6 doctor visits and the bill charged by the doctor for 6 visits is $360, the cost per visit paid by a third party is:

Refer to the following graph. If the price is set at Pc:

Refer to the following graphs. A recent report indicated that 50 intensive-care unit patients die for every 1,000 who are managed with a heart device known as the right heart catheter. Suppose as a result, the FDA limited supply of the heart catheters. The effect of the report and subsequent action by the FDA on the market for right heart catheters is best shown by which of the graphs?

What events most likely explain the following Wall Street Journal headline, "Cities Couldn't Give Away Their Trash; Now They Get Top Dollar"?

Use a supply/demand diagram to explain the effects of a government-imposed price ceiling that is above the equilibrium price.What will be the effective quantity and price in this situation?

Explain the shifts in demand and/or supply that can result in the following observations: (Assume the demand curve is downward sloping and the supply curve is upward sloping. ) (a)Both price and quantity rise. (b)Price rises,quantity falls. (c)Price rises,quantity doesn't change. (d)Quantity rises,price doesn't change.

Season tickets to the Miami Heat games are sold out at $30 a game and some people who wanted to get tickets couldn't buy them. As the season progresses, it is clear that the Heat will make it to the playoffs. What is the effect on resale price of tickets to Miami Heat games, assuming resale is legal?

Given the equations for demand and supply: Qd = 48 − 4P and Qs = 4P − 16, respectively, the market is in equilibrium when the quantity bought and sold is:

If the government imposes an excise tax on gasoline equal to $0.25 per gallon and the demand curve for gasoline is downward-sloping, the supply of gasoline will:

Given a downward sloping demand curve, a tax on the supply of a good will result in an increase in equilibrium price that is less than the amount of the tax.

The U.S. imposes substantial taxes on cigarettes but not on loose tobacco. When the tax on cigarettes went into effect, the demand for home cigarette rolling machines most likely:

Consider the following scenario: Average household incomes have grown leading to an increase in electrical appliance use,boosting demand for electricity faster than capacity is being added.Analyze the impact on quantity demanded and price of electricity using a supply and demand diagram.