Exam 4: Supply and Demand: Applications and Extensions

If a $2 tax per bottle of wine is imposed on wine producers, which of the following will occur?

If the government wants to raise tax revenue and shift most of the tax burden to the consumers, it would impose a tax on a good with a

Use the figure below to answer the following question(s). Figure 4-7 Refer to Figure 4-7. The supply curve S ₁ and the demand curve D indicate initial conditions in the market for gasoline. A $.60-per-gallon excise tax on gasoline is levied, which shifts the supply curve from S ₁ to S ₂. Imposing the tax causes the equilibrium price of gasoline to increase from

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

Figure 4-16 Refer to Figure 4-16. Some policymakers have argued that the government should establish a "living wage." A living wage would provide workers a reasonable standard of living in their city or region. If a living wage of $10 per hour is established in the market pictured here, we would expect

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?

Which of the following is a major disadvantage of setting the price of a good below equilibrium and using waiting in line rather than price to ration the good?

If we observe long lines of people camping out to get tickets to a concert, this tells us

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

A legal minimum wage is an example of

Figure 4-20 Refer to Figure 4-20. The price that sellers receive after the tax is imposed is

Other things constant, if a labor union is able to successfully increase the wages of autoworkers, there will be

Rent controls generally fix the price of rental housing below market equilibrium. Economic analysis suggests these controls

A politician was recently quoted as saying, "Our country can only reach full employment by raising the minimum wage, which would cause the demand for products to increase . . . and eventually cause production to expand." His analysis overlooks the fact that

A progressive tax is defined as a tax for which the

Figure 4-20 Refer to Figure 4-20. The burden of the tax on sellers is

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. How much revenue would the $.40 gasoline tax raise?

Use the figure below to answer the following question(s). Figure 4-11 Refer to Figure 4-11. On the Laffer curve shown, which of the following is true?

During the Prohibition period (when the production and sale of alcohol was illegal),

Figure 4-15 In Figure 4-15, suppose a price floor is established at $20.00. What is the result?