econ2 quiz 4 2nd attempt

Refer to the figure below. If the government set a price floor of $80, the excess supply will be: 16

28. (wrong)

A government decides to set a price ceiling on eggs so that eggs are affordable to the poor. The conditions of demand and supply are given in the table below. What will the excess supply or the shortage be if the price ceiling is set at $2.00?

3,000 shortage

How does a price floor set above the equilibrium price affect quantity demanded and quantity supplied?

It results in a greater quantity supplied than the quantity demanded, otherwise known as excess supply.

As the new technology of large capacity paint sprayers for house painting arrived in the market, what effect did it have on the house painting labor market?

Painting companies supply of low skilled house painters decreased and the equilibrium price of wages for low skilled painters increased.

Alabama this winter was socked in with snow which closed highways, stores and schools for weeks. Because of the road closures, soup was in greater demand but short on supply. The government put a temporary price ceiling on the cost of soup at $1. If the equilibrium for soup was at $5, what do you think happened

There was greater demand than supplied and people began a black market for selling and delivering soup.

Supply and demand for bushels of wheat (millions) are shown in the following table. A $10.00 price floor would result in:

an excess supply of 4 million bushels and a price of $10.00.

Country A has great expertise in the production of planes and produces a large quantity of planes while country B has expertise in the production of automobiles and produces large quantities of cars. When the two countries trade planes for automobiles

both countries improve allocative efficiency because they can now consume a more desirable combination of goods and services (planes and cars) through trade.

As the number of people holding college degrees increases, assuming the demand for college educated labor stays constant, the wages of college educated people would

decrease as the supply of college educated labor increases.

Refer to the figure below. If the government sets a price ceiling at $20, there would be a(n)

excess shortage of 26 units. (wrong)

Price floors typically result in ____

excess supply

Requiring that all employees get a minimum wage of $8.00 is an example of a

price floor.

Price ceilings typically result in ___

shortages

If you were describing consumer surplus, you would say it is the social surplus minus producer surplus.

the difference between an item's production cost and the amount paid by consumers (wrong)

When Ian experiences diminishing marginal utility when buying shirts

the personal value of each additional shirt he purchases starts to fall.

Advances in information technology reduced the cost of production of computers and other electronic devices. As a result

the supply of computers and electronic devices increased and the price of these devices fell.

the current economy is strong and many people are feeling confident about their future and ability to pay off debt. Because of this they are taking on more bank loans for things like new cars, renovations their homes, or buying new homes. Using the four step process with this type of market, what will banks most likely do with their loans?

the supply/or demand will INCREASE and the interest rate will INCREASE as well.

Individuals and countries will continue to trade airplanes for cars until

the value of each additional airplane and car is equal for both countries or individuals.