Question 1

Use the following to answer questions :  
-(Figure: Rent Controls)Use Figure: Rent Controls.If rent controls are set at Rent3:

Accepted Answer

A)  the shortage of rental units is the distance Q3-Q1. 
B)  some renters will be willing to pay a price as high as Rent4 for Q3 units. 
C)  no one will have to pay a higher actual price than Rent0,nor will anyone be willing to do so. 
D)  rent will remain at Rent2. 
A)  the shortage of rental units is the distance Q3-Q1. 
B)  some renters will be willing to pay a price as high as Rent4 for Q3 units. 
C)  no one will have to pay a higher actual price than Rent0,nor will anyone be willing to do so. 
D)  rent will remain at Rent2.

Question 2

In a(n)_____ market,goods or services are bought and sold illegally.

Accepted Answer

A)  black 
B)  uncontrolled 
C)  unregulated 
D)  unproductive 
A)  black 
B)  uncontrolled 
C)  unregulated 
D)  unproductive

Question 3

Use the following to answer questions :  
-(Figure: Price Controls)Use Figure: Price Controls.The consumer surplus lost to a price floor at point b is equal to the area:

Accepted Answer

A)  abe. 
B)  egh. 
C)  bcge. 
D)  bcke. 
A)  abe. 
B)  egh. 
C)  bcge. 
D)  bcke.

Question 4

The market for salmon is in equilibrium.A binding price ceiling,a binding price floor,and a quota limit below the market equilibrium in this market would all cause:

Accepted Answer

A)  deadweight loss arising from a quantity exchanged that is less than the equilibrium quantity. 
B)  a supply price that exceeds a demand price. 
C)  revenue collected by the government on each unit of salmon harvested. 
D)  deadweight loss arising from a transfer of surplus from consumers to producers. 
A)  deadweight loss arising from a quantity exchanged that is less than the equilibrium quantity. 
B)  a supply price that exceeds a demand price. 
C)  revenue collected by the government on each unit of salmon harvested. 
D)  deadweight loss arising from a transfer of surplus from consumers to producers.

Question 5

Rent controls in New York City do NOT cause:

Accepted Answer

A)  inefficiently low-quality apartments. 
B)  wasted resources resulting from the opportunity cost of time associated with trying to find an apartment. 
C)  black markets. 
D)  an increase in the quantity supplied of rent-controlled apartments. 
A)  inefficiently low-quality apartments. 
B)  wasted resources resulting from the opportunity cost of time associated with trying to find an apartment. 
C)  black markets. 
D)  an increase in the quantity supplied of rent-controlled apartments.

Question 6

Quantity controls usually take the form of price ceilings or price floors established by the government.

Accepted Answer

A) True 
 B)False

Question 7

Use the following to answer questions :  
-(Figure: Rent Controls)Use Figure: Rent Controls.Without rent controls,the equilibrium quantity is:

Accepted Answer

A)  Q4. 
B)  Q1. 
C)  Q2. 
D)  Q3. 
A)  Q4. 
B)  Q1. 
C)  Q2. 
D)  Q3.

Question 8

Use the following to answer questions :
Figure: Market I  
-(Figure: Market I)Use Figure: Market I.A price floor at $15 would result in deadweight loss of:

Accepted Answer

A)  $9. 
B)  $10. 
C)  $20. 
D)  $40.50. 
A)  $9. 
B)  $10. 
C)  $20. 
D)  $40.50.

Question 9

Use the following to answer questions :
Figure: Market I  
-(Figure: Market I)Use Figure: Market I.If a price floor of $15 is imposed on this market and the government chooses to purchase the surplus,the government must buy _____ units of the good and spend a total amount of _____ on its purchase.

Accepted Answer

A)  5;$75 
B)  10;$150 
C)  9;$135 
D)  9;$81 
A)  5;$75 
B)  10;$150 
C)  9;$135 
D)  9;$81

Question 10

Use the following to answer questions :
Figure: The Shrimp Market  
-(Figure: The Shrimp Market)Use Figure: The Shrimp Market.If the government imposes a quota limiting sales of shrimp to 250 kilograms,the quota rent per kilogram is:

Accepted Answer

A)  $17.50. 
B)  $10. 
C)  $7.50. 
D)  $0. 
A)  $17.50. 
B)  $10. 
C)  $7.50. 
D)  $0.

Question 11

Use the following to answer question 50: $$\begin{array}{l}
\text { Table: Market for Butter }\
\begin{array} { c r r } 
\hline  \boldsymbol { P } & { \boldsymbol { Q } ^ { D } } & \boldsymbol { Q } ^ { S } \
\hline \$ 1.20 & 9.0 & 12.0 \
1.10 & 9.5 & 11.0 \
1.00 & 10.0 & 10.0 \
0.90 & 10.5 & 9.0 \
0.80 & 11.0 & 8.0
\end{array}
\end{array}$$
-(Table: Market for Butter)Use Table: Market for Butter.If the government imposes a price ceiling of $0.90 per kilogram of butter,the quantity of butter actually purchased will be _____ million kilograms.

Accepted Answer

A)  10.5 
B)  9.0 
C)  1.5 
D)  10.0 
A)  10.5 
B)  9.0 
C)  1.5 
D)  10.0

Question 12

If the province of Quebec established a price floor in the market for pumpkins that was double the current market-clearing price,this would lead to an inefficient number of pumpkins sold in Quebec.

Accepted Answer

A) True 
 B)False

Question 13

The total amount of a good that can be transacted under a quantity control is called the:

Accepted Answer

A)  ceiling price. 
B)  demand price. 
C)  quota limit. 
D)  supply price. 
A)  ceiling price. 
B)  demand price. 
C)  quota limit. 
D)  supply price.

Question 14

Use the following to answer questions :  
-(Figure: Rent Controls)Use Figure: Rent Controls.Without rent controls,the equilibrium rent is:

Accepted Answer

A)  Rent4. 
B)  Rent1. 
C)  Rent2. 
D)  Rent3. 
A)  Rent4. 
B)  Rent1. 
C)  Rent2. 
D)  Rent3.

Question 15

Use the following to answer question 90:
Figure: The Shrimp Market  
-Which example would be considered a price floor?

Accepted Answer

A)  a rent-controlled apartment 
B)  a maximum legal price that could be charged for gasoline during a time of war 
C)  the minimum wage 
D)  a government decree that capped the price of bottled water in the aftermath of a devastating hurricane 
A)  a rent-controlled apartment 
B)  a maximum legal price that could be charged for gasoline during a time of war 
C)  the minimum wage 
D)  a government decree that capped the price of bottled water in the aftermath of a devastating hurricane

Question 16

Use the following to answer questions : $$\begin{array}{l}
\text { Table: Quantity Supplied and Quantity Demanded }\
\begin{array} { r c c } 
\hline \text { Price } & \text { Quantity Demanded } & \text { Quantity Supplied } \
\hline \$ 0 & 100 & 25 \
5 & 90 & 40 \
10 & 80 & 55 \
15 & 70 & 70 \
20 & 60 & 85 \
\hline
\end{array}
\end{array}$$
-(Table: Quantity Supplied and Quantity Demanded)Use Table: Quantity Supplied and Quantity Demanded.If a price ceiling of $10 is imposed in this market:

Accepted Answer

A)  the quantity demanded will be greater than the quantity supplied. 
B)  the quantity supplied will be greater than the quantity demanded. 
C)  an equilibrium quantity will result. 
D)  excess supply equal to 25 units will result. 
A)  the quantity demanded will be greater than the quantity supplied. 
B)  the quantity supplied will be greater than the quantity demanded. 
C)  an equilibrium quantity will result. 
D)  excess supply equal to 25 units will result.

Question 17

The minimum wage,which sets a lower limit on the wages that workers can earn,is often above the equilibrium price.The minimum wage is an example of a(n):

Accepted Answer

A)  price floor. 
B)  price ceiling. 
C)  quota. 
D)  equilibrium price. 
A)  price floor. 
B)  price ceiling. 
C)  quota. 
D)  equilibrium price.

Question 18

Use the following to answer question 72: $$\begin{array}{l}
\text { Table: The Market for Pop }\
\begin{array} { l c c } 
\hline &{ \text { Market for a Can of Pop } } \
\begin{array} { l } 
\text { Price } \
\text { (\$/unit) }
\end{array} & \begin{array} { c } 
\text { Quantity Demanded } \
\text { (cans) }
\end{array} & \begin{array} { c } 
\text { Quantity Supplied } \
\text { (cans) }
\end{array} \
\hline 0.50 & 10 & 7 \
0.75 & 8 & 8 \
1.00 & 6 & 9 \
1.25 & 4 & 10 \
1.50 & 2 & 11
\end{array}
\end{array}$$
-(Table: The Market for Pop)Use Table: The Market for Pop.If the government imposes a price floor of $1 per can of pop,there will be:

Accepted Answer

A)  a shortage of two cans. 
B)  a shortage of three cans. 
C)  a surplus of three cans. 
D)  equilibrium in the market for soda. 
A)  a shortage of two cans. 
B)  a shortage of three cans. 
C)  a surplus of three cans. 
D)  equilibrium in the market for soda.

Question 19

Use the following to answer question 77:  
-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 _____.

Accepted Answer

A)  fall;rise 
B)  fall;fall 
C)  rise;fall 
D)  rise;rise 
A)  fall;rise 
B)  fall;fall 
C)  rise;fall 
D)  rise;rise

Question 20

Use the following to answer questions :  
-(Figure: The Market for Economics Textbooks)Use Figure: The Market for Economics Textbooks.At a price ceiling of $40,the market outcome would be a _____ of _____ textbooks.

Accepted Answer

A)  surplus;30 
B)  surplus;10 
C)  shortage;30 
D)  shortage;10 
A)  surplus;30 
B)  surplus;10 
C)  shortage;30 
D)  shortage;10

Use the following to answer questions : -(Figure: Rent Controls)Use Figure: Rent Controls.If rent controls are set at Rent₃:

In a(n)_____ market,goods or services are bought and sold illegally.

Use the following to answer questions : -(Figure: Price Controls)Use Figure: Price Controls.The consumer surplus lost to a price floor at point b is equal to the area:

The market for salmon is in equilibrium.A binding price ceiling,a binding price floor,and a quota limit below the market equilibrium in this market would all cause:

Rent controls in New York City do NOT cause:

Quantity controls usually take the form of price ceilings or price floors established by the government.

Use the following to answer questions : -(Figure: Rent Controls)Use Figure: Rent Controls.Without rent controls,the equilibrium quantity is:

Use the following to answer questions : Figure: Market I -(Figure: Market I)Use Figure: Market I.A price floor at $15 would result in deadweight loss of:

Use the following to answer questions : Figure: Market I -(Figure: Market I)Use Figure: Market I.If a price floor of $15 is imposed on this market and the government chooses to purchase the surplus,the government must buy _ units of the good and spend a total amount of _ on its purchase.

Use the following to answer questions : Figure: The Shrimp Market -(Figure: The Shrimp Market)Use Figure: The Shrimp Market.If the government imposes a quota limiting sales of shrimp to 250 kilograms,the quota rent per kilogram is:

If the province of Quebec established a price floor in the market for pumpkins that was double the current market-clearing price,this would lead to an inefficient number of pumpkins sold in Quebec.

The total amount of a good that can be transacted under a quantity control is called the:

Use the following to answer questions : -(Figure: Rent Controls)Use Figure: Rent Controls.Without rent controls,the equilibrium rent is:

Use the following to answer question 90: Figure: The Shrimp Market -Which example would be considered a price floor?

The minimum wage,which sets a lower limit on the wages that workers can earn,is often above the equilibrium price.The minimum wage is an example of a(n):

Use the following to answer question 77: -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 _.

Use the following to answer questions : -(Figure: The Market for Economics Textbooks)Use Figure: The Market for Economics Textbooks.At a price ceiling of $40,the market outcome would be a _ of _ textbooks.

First Principles

Economic Models

Supply and Demand

Consumer and Producer Surplus

Elasticity

Taxes

International Trade

Decision Making by Individuals and Firms

The Rational Consumer

Behind the Supply Curve- Inputs and Costs

Perfect Competition and the Supply Curve

Monopoly

Oligopoly

Monopolistic Competition

Externalities

Public Goods and Common Resources

The Economics of the Welfare State

Factor Markets and the Distribution of Income

Uncertainty, risk, and Private Information

Graphs in Economics

Consumer Preferences

Indifference Curve Analysis

Filters

Exam 5: Price Controls and Quotas

Use the following to answer questions : -(Figure: Rent Controls)Use Figure: Rent Controls.If rent controls are set at Rent3:

In a(n)_____ market,goods or services are bought and sold illegally.

Use the following to answer questions : -(Figure: Price Controls)Use Figure: Price Controls.The consumer surplus lost to a price floor at point b is equal to the area:

The market for salmon is in equilibrium.A binding price ceiling,a binding price floor,and a quota limit below the market equilibrium in this market would all cause:

Rent controls in New York City do NOT cause:

Quantity controls usually take the form of price ceilings or price floors established by the government.

Use the following to answer questions : -(Figure: Rent Controls)Use Figure: Rent Controls.Without rent controls,the equilibrium quantity is:

Use the following to answer questions : Figure: Market I -(Figure: Market I)Use Figure: Market I.A price floor at $15 would result in deadweight loss of:

Use the following to answer questions : Figure: Market I -(Figure: Market I)Use Figure: Market I.If a price floor of $15 is imposed on this market and the government chooses to purchase the surplus,the government must buy _____ units of the good and spend a total amount of _____ on its purchase.

Use the following to answer questions : Figure: The Shrimp Market -(Figure: The Shrimp Market)Use Figure: The Shrimp Market.If the government imposes a quota limiting sales of shrimp to 250 kilograms,the quota rent per kilogram is:

If the province of Quebec established a price floor in the market for pumpkins that was double the current market-clearing price,this would lead to an inefficient number of pumpkins sold in Quebec.

The total amount of a good that can be transacted under a quantity control is called the:

Use the following to answer questions : -(Figure: Rent Controls)Use Figure: Rent Controls.Without rent controls,the equilibrium rent is:

Use the following to answer question 90: Figure: The Shrimp Market -Which example would be considered a price floor?

The minimum wage,which sets a lower limit on the wages that workers can earn,is often above the equilibrium price.The minimum wage is an example of a(n):

Use the following to answer question 77: -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 _____.

Use the following to answer questions : -(Figure: The Market for Economics Textbooks)Use Figure: The Market for Economics Textbooks.At a price ceiling of $40,the market outcome would be a _____ of _____ textbooks.

First Principles

Economic Models

Supply and Demand

Consumer and Producer Surplus

Elasticity

Taxes

International Trade

Decision Making by Individuals and Firms

The Rational Consumer

Behind the Supply Curve- Inputs and Costs

Perfect Competition and the Supply Curve

Monopoly

Oligopoly

Monopolistic Competition

Externalities

Public Goods and Common Resources

The Economics of the Welfare State

Factor Markets and the Distribution of Income

Uncertainty, risk, and Private Information

Graphs in Economics

Consumer Preferences

Indifference Curve Analysis

Filters

Use the following to answer questions : -(Figure: Rent Controls)Use Figure: Rent Controls.If rent controls are set at Rent₃:

Use the following to answer questions : Figure: Market I -(Figure: Market I)Use Figure: Market I.If a price floor of $15 is imposed on this market and the government chooses to purchase the surplus,the government must buy _ units of the good and spend a total amount of _ on its purchase.

Use the following to answer question 77: -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 _.

Use the following to answer questions : -(Figure: The Market for Economics Textbooks)Use Figure: The Market for Economics Textbooks.At a price ceiling of $40,the market outcome would be a _ of _ textbooks.