Exam 4: Supply and Demand: Applications and Extensions

When a price ceiling prevents a higher market price from rationing a good,

In a market economy, which of the following will most likely cause a prolonged milk shortage?

In the supply and demand model, a subsidy granted to sellers is illustrated by

Use the table below to choose the correct answer. For the income range illustrated, the tax shown here is

Figure 4-20 -Refer to Figure 4-20. The price that buyers pay after the tax is imposed is

A $25 government subsidy paid directly to buyers of jeans will result in

The benefit of a subsidy will go primarily to sellers when the

If the federal government began granting a subsidy of 10 cents per apple to apple growers and as a result the price of apples to consumers falls by 8 cents,

Bill the butcher is upset because the government plans to tax beef $.10 a pound. "I hate paying taxes," he says. "Because of this, I'm raising all my beef prices by $.10 a pound. The consumers will bear this burden, not me." Do you see anything wrong with this way of thinking? Explain.

Other things constant, how will a decrease in the wages of teenagers affect the market for fast food hamburgers?

Which of the following statements is true?

Use the figure below to answer the following question(s). Figure 4-9 -Refer to Figure 4-9. The market for gasoline was initially in equilibrium at point b and a $.40 excise tax is illustrated. Which of the following states the actual burden of the tax?

Figure 4-22 -Refer to Figure 4-22. Suppose the same S and D curves apply, and a tax of the same amount per unit as shown here is imposed. Now, however, the buyers of the good, rather than the sellers, are required to pay the tax to the government. Now,

Suppose the federal excise tax rate on gasoline is increased by 50 percent. Which of the following is the most likely impact on the tax revenue derived from the federal gas tax?

Figure 4-3 -Figure 4-3 indicates the demand (D) and supply (S) for the rental housing market in a large city. If the government imposed a price ceiling of a, which of the following would be true?

The market pricing system corrects an excess supply by

About 35,000 general aviation multiengine airplanes are licensed to operate in the United States. If an additional $1,000-per-year tax was levied on each plane to raise general revenue, economic thinking suggests the

The imposition of price ceilings on a market often results in

Suppose the United Auto Workers union obtains a substantial wage increase for auto workers. How will this affect the market for automobiles?

Rent control applies to about two-thirds of the private rental housing in New York City. Economic theory suggests that the below-equilibrium prices established by rent controls would