Exam 4: Supply and Demand: Applications and Extensions

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,

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?

The average tax rate is defined as

Which of the following statements is true?

Suppose the U.S. Government banned the sale and production of cigarettes. What are likely effects of this action on the market for cigarettes?

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. What does the triangular area abc represent?

A $10 per unit government subsidy paid directly to sellers of heaters will result in

The excess burden or deadweight loss of a tax refers to the

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?

If there was an increase in the excise tax imposed on guitar suppliers, what would be the effect on the equilibrium price and quantity of guitars?