06 Micro Econ quiz questions

Refer to Figure 6-23. The effective price received by sellers after the tax is imposed is a. $5 b. $4 c. $3 d. $6

$3

Suppose sellers of the good successfully lobby Congress to impose a price floor $2 above the equilibrium price in this market. Refer to Table 6-3. Following the imposition of a price floor $2 above the equilibrium price, irate buyers convince Congress to repeal the price floor and to impose a price ceiling $1 below the former price floor. The resulting market price is a. $4. b. $3. c. $2. d. $5.

$3

Table 6-5 Price Quantity Quantity Demanded Supplied $0 150 0 $3 120 45 $6 90 90 $9 60 135 $12 30 180 $15 0 225 Refer to Table 6-5. Which of the following price ceilings would be binding in this market? a. $3 b. $9 c. None of the price ceilings listed would be binding. d. $6

$3

Which of the following causes the price paid by buyers to be different than the price received by sellers? a. a tax on the good b. a binding price floor c. a binding price ceiling d. All of the answers listed are correct.

a tax on the good

If the government levies a $1,000 tax per boat on sellers of boats, then the price paid by buyers of boats would a. decrease by an indeterminate amount. b. increase by exactly $1,000. c. increase by less than $1,000. d. increase by more than $1,000.

increase by less than $1,000

Assume the demand for cigarettes is relatively inelastic, and the supply of cigarettes is relatively elastic. When cigarettes are taxed, we would expect a. the distribution of the tax burden between buyers and sellers of cigarettes to depend on whether buyers or sellers of cigarettes are required to pay the tax to the government. b. a large percentage of smokers to quit smoking in response to the tax. c. most of the burden of the tax to fall on sellers of cigarettes, regardless of whether buyers or sellers of cigarettes are required to pay the tax to the government. d. most of the burden of the tax to fall on buyers of cigarettes, regardless of whether buyers or sellers of cigarettes are required to pay the tax to the government.

most of the burden of the tax to fall on buyers of cigarettes, regardless of whether buyers or sellers of cigarettes are required to pay the tax to the government.

Refer to Figure 6-6. If the government imposes a price floor of $6 on this market, then there will be a. a surplus of 30 units b. no surplus c. a surplus of 40 units d. a surplus of 20 units

no surplus (there'd be a shortage)

A minimum wage that is set above a market's equilibrium wage will result in an excess a. supply of labor, that is, unemployment. b. supply of labor, that is, a shortage of workers. c. demand for labor, that is, unemployment. d. demand for labor, that is, a shortage of workers.

supply of labor, that is unemployment

Refer to Figure 6-30. In which market will the tax burden be most equally divided between buyers and sellers? a. All of the answers listed are correct. b. the market shown in panel (c). c. the market shown in panel (b). d. the market shown in panel (a).

the market shown in panel (c)

Refer to Figure 6-22. Suppose the same supply and demand curves apply, and a tax of the same amount per unit as shown here is imposed. Now, however, the buyers of the good, rather than the sellers, are required to pay the tax to the government. After the buyers pay the tax, relative to the case depicted in the figure, the burden on buyers will be a. The relative burdens in the two cases cannot be determined without further information. b. smaller, and the burden on sellers will be larger. c. larger, and the burden on sellers will be smaller. d. the same, and the burden on sellers will be the same.

the same, and the burden on sellers will be the same.