Exam 4: Price Controls and Quotas: Meddling With Markets

The upper limit on the quantity of a good that can be bought and sold is the:

All else equal,if a price floor above the equilibrium is imposed on a market and the government buys the surplus,consumer surplus will _____ and producer surplus will _____.

In New York City,there are more than 100 000 licensed taxicabs.

If the demand curve for clams is downward sloping,a quota that is set below the equilibrium quantity will decrease the price that consumers pay for clams.

Use the following to answer questions: -(Table: The Market for Pop)Use Table: The Market for Pop.If the government imposes a price ceiling of $1 per can of pop the quantity of pop demanded will be _____ cans.

Use the following to answer question : -(Figure: The Market for Tortillas)Use Figure: The Market for Tortillas.With a nonbinding price floor,the price could be equal to _____,consumers would demand _____,and producers would supply _____.

An effective price floor will lead to:

To be binding,a price ceiling must be set at a price _____ the equilibrium price.

Use the following to answer question : -(Figure: The Market for Spanish Textbooks)Use Figure: The Market for Spanish Textbooks.Suppose that the government believes the producers of Spanish textbooks are not profitable,and it wants to make sure textbook producers are profitable.It could impose a control called a price _____,and for it to be binding,one possible price would be _____.

Use the following to answer question : -(Figure: Price Control)Use Figure: Price Control.One effective price ceiling would be the price indicated at point _____,and there would be a _____ equal to the difference between points _____.

In the rental housing market with price controls,the quantity of rental houses demanded exceeds the quantity of rental housing supplied.This price control must be a:

Use the following to answer questions: -(Table: The Market for Pop)Use Table: The Market for Pop.If the government imposes a price ceiling of $0.50 per can of pop,there will be:

Price controls:

When price controls take the form of maximum prices set below the equilibrium price,they are:

Use the following to answer questions: -(Figure: Supply and Demand)Use Figure: Supply and Demand.A price ceiling of P₁ causes:

Use the following to answer question : -The dictator of a small country restricts the price of cars to an amount less than or equal to $1 200 (a price below the equilibrium price for cars).Such a policy would set a:

Which example is a quantity control?

The difference between the demand price and the supply price at the quota limit amount is the:

The persistent unwanted surplus that results from a binding price floor causes inefficiencies that do NOT include:

If the government imposes binding rent control: