ECON - 2301.301 Chapter 4 Quiz

Price controls:

can result in inequitable outcomes.

(Exhibit: A Tax) Consider the demand and supply for movie tickets in a small town. When the government imposes a $5 tax on the sale of movie tickets, the quantity traded in the marketplace:

falls from 130 to 80.

When the government imposes a tax on a product, buyers will be most negatively impacted if:

the burden does not depend on who the government collects the tax from.

(Exhibit: A Tax) Consider the demand and supply for movie tickets in a small town. When the government imposes a $5 tax on the sale of movie tickets, the (net) price ultimately paid by buyers will be:

$13

(Exhibit: A Tax) Consider the demand and supply for movie tickets in a small town. When the government imposes a $5 tax on the sale of movie tickets, the (net) price ultimately received by sellers will be:

$8

The relationship between the value and price of a stock suggests that:

A and B are true.

A tax:

All of the above are true.

(Exhibit: Supply and Demand in Agriculture) If a price floor at P4 is set to help farmers in terms of income and government wants to assure farmers that their output will be purchased, the government would have to purchase an amount of output equal to:

Q3 - Q0.

(Exhibit: Rent Controls) If rent controls are imposed, they will most likely be set at either _______ or _______.

Rent0; Rent1

(Exhibit: Rent Controls) Without rent controls, the equilibrium rent is _______ and the equilibrium quantity is _______.

Rent2; Q2

(Exhibit: Supply and Demand in Agriculture) To help farmers:

a price floor would be set at P4, causing a surplus of Q3 - Q0.

The bulk of the nation's output is produced by:

corporations.

Rent controls:

often help high-income families.

Governments often impose taxes because they want to discourage behaviors that officials believe is undesirable. This rationale for the tax is called:

paternalism

In the personal computer industry, the reason for the fall in prices and the increase in quantity after 1980 was:

primarily due to technological change and an increase in the number of sellers.

Suppose an oil producer wants to ensure her business by lobbying her government to tax electric cars. This rationale for the tax—handicapping the business of one's competitors—is called:

rent seeking.

A firm owned by one individual is called a:

sole proprietorship.

Most firms in the United States today are:

sole proprietorships and partnerships.

(Exhibit: Rent Controls) If rent controls are set at Rent0:

some renters would be willing to pay a price as high as Rent4 for Q0 units.

Governments often impose taxes because they need money to fund their operations. This rationale for the tax is called:

the revenue argument.