Microeconomics chapter 6

According to the same article, the best way to help tenants is to

"grant economic freedom to landlords."

According to the article "Problems with Rent Control" posted on the Required Reading Folder, most economists would agree that rent control

"reduces the quantity and quality of housing available."

According to the graph, after a tax is imposed the amount of the tax that sellers would pay per unit (sellers' tax burden, or sellers' tax incidence) is:

$1 per gallon.

According to the graph, the amount of the tax that buyers would pay (buyers' tax burden, or tax incidence) is:

$1 per gallon.

A tax is imposed on the buyers. This tax shifts the gasoline demand curve to the left. According to the graph from the above question, the tax amount is:

$2 per gallon.

According to the graph, the price sellers receive after the tax is imposed is

$5 per gallon.

The demand and supply curves of a hypothetical gasoline market are shown in the graph above. The equilibrium price before the tax is imposed is

$6.00

According to the graph, the price buyers will pay after the tax is imposed is

$7 per gallon.

Which of the following is the most correct statement about tax burdens?

A tax burden falls most heavily on the side of the market that is inelastic.

Which is the most correct statement about the burden of a tax imposed on buyers of popcorn?

Buyers and sellers share the burden of the tax.

According to the same article, rent control in New York was the reason for

Correct. About thirty thousand New York apartments were abandoned annually from 1972 to 1982, a loss of almost a third of a million units in this eleven-year period.

Rent control is

a common example of a price ceiling.

Economists generally hold that rent control is

a highly inefficient way to help the poor raise their standard of living.

FICA is an example of

a payroll tax

According to the graph shown, if the government imposes a binding price ceiling in this market at a price of $4.00, the result would be

a shortage of 40 units.

According to the same graph, if the government imposes a binding price floor of $7.00 in this market, the result would be

a surplus of 20.

The market rent of a one bedroom apartment is $1,000. The city goverment imposes a rent ceiling of $800 to make rent more affordable to the poors. Such rent control would likely lead to

all of the above are correct.

In general, advocates of the minimum wage

believe that adverse effects are small, and generally a higher minimum wage makes the poor better off.

If a tax is imposed on a market with inelastic demand and elastic supply,

buyers will bear most of the burden of the tax.

Price controls

can generate inequities of their own.

A tax on the buyers of popcorn will

cause the price the buyer pays to rise and the price the seller receives to fall.

The incidence of a tax eventually

depends on the forces of supply and demand.

The typical study on the effect of the minimum wage on teenage employment finds that a 10 percent increase in the minimum wage

depresses teenage employment by 1 to 3 percent.

The term tax incidence refers to

division of the tax burden between buyers and sellers

Congress intended that

half the FICA tax be paid by workers, and half be paid by firms.

A tax on the buyers of popcorn will a) reduce the equilibrium price of popcorn, and increase the equilibrium quantity. b)increase the equilibrium price of popcorn, and reduce the equilibrium quantity. c) increase the equilibrium price of popcorn, and increase the equilibrium quantity. d)reduce the equilibrium price of popcorn, and reduce the equilibrium quantity.

increase the equilibrium price of popcorn, and reduce the equilibrium quantity.

The initial effect of a tax on the buyers of a good

is on the demand for that good.

The equilibrium wages of teenagers tend to be

low because teenagers are among the least skilled and least experienced workers.

Revenue from the FICA tax is used to

pay for Social Security and Medicare.

The key feature of a payroll tax is that it

places a tax wedge between the wage that firms pay and the wage that workers receive.

A binding price ceiling will lead to

rationing of the product, because there will be a shortage.

If a tax is imposed on a market with elastic demand and inelastic supply,

sellers will bear most of the burden of the tax.

When analyzing the economic effects of government policies,

supply and demand are the most useful tools of analysis.

Long lines at gas stations in the U.S. in the 1970s were primarily a result of

the fact that the U.S. government had imposed a price ceiling on gasoline.

The minimum wage has its greatest impact on

the market for teenage labor.

If the minimum wage is above the equilibrium wage,

the quantity demanded of labor will be less than the quantity supplied.

When a payroll tax is enacted,

the wage received by workers falls and the wage paid by firms rises

Workers with high skills and much experience are not affected by the minimum wage because

their equilibrium wages are well above the minimum wage.

Price controls are

usually enacted when policymakers believe that the market price of a good or service is unfair to buyers or sellers