Exam 4: Extensions of Demand and Supply Analysis

-Refer to the above figure. If the government imposes a price ceiling of $60,

If a price ceiling is set above the current market clearing price, then

Would it take longer for a labor market to move to a new equilibrium for house painters or architects? Why?

Why does an economy need a rationing mechanism?

Of the following groups, which benefits most from a government price support program that establishes a floor price for an agricultural product that is higher than the product's market clearing price?

When the government establishes a minimum price for an agricultural product above the equilibrium price, the government is creating a(n)

-Refer to the above figure. If a price floor of $5 was set,

-Refer to the above figure. If a price ceiling of $3 was set,

The market clearing price of computer modems has just decreased. Which of the following could have caused this change?

If demand and supply both increase,

In the 1970s, the government placed price ceilings on gasoline prices. A shortage of gasoline occurred, and long lines formed at the pumps. Some gas stations required that in addition to paying the price on the pump you had to buy a blank will. The action of having to purchase the will in order to purchase gas is known as

Suppose that the supply curve remains unchanged. If the demand curve shifts to the right,

A price ceiling set above the equilibrium price will cause which of the following?

The signaling aspect of the market system refer to

When a market clearing price is determined,

With respect to the market clearing price and the equilibrium quantity of good X, increases in the demand for and the supply of good X will definitely

If supply decreases and demand increases,

Another term for intermediaries who specialize in reducing transaction costs is

For a given market demand curve, if the market clearing price increases, then the amount of producer surplus will

-Refer to the above figure. A surplus occurs if the government imposes