9/6 micro quiz
The graph shows the market supply (S) and demand (D) curves for a particular product. If the government imposes a price ceiling at P2, which of the following statements is true?
remains at Q2 because the price ceiling is not binding.
A nation engages in international trade with its trading partners and is currently an importer of aluminum. Imposing an import tariff on aluminum will affect the domestic market for aluminum in which of the following ways?
suppied ncrease, supplus decrease, P increase
Consumer surplus is defined as
the difference between the value that consumers place on a good and the price they pay
Which of the following will result in the short run if the government imposes a binding quota?
A deadweight loss
Apples are produced in a perfectly competitive market with no government intervention. Which of the following price changes will cause the total economic surplus to increase for the apple market depicted in the graph provided?
A decrease in price from $8 to $6
A decrease in the supply of pencils results in which of the following?
A decrease in the consumer surplus of pencil buyers
The supply of townhouses will increase.
A decrease in the cost of land devoted for building townhouses will most likely cause which of the following?
Which of the following will occur in the market for bicycles if the government establishes a binding price floor?
A decrease in the quantity of bicycles purchased
Consumer surplus could be the shaded area in which of the following situations?
A price ceiling set at P1 in the market
Which of the following best illustrates the concept of consumer surplus?
A thirsty athlete pays $0.85 for a cold drink when she would have gladly paid $1.50 for the drink.
Which of the following will likely result in an indeterminate change in the equilibrium quantity of a competitive market?
An increase in demand and a decrease in supply
If a normal good is produced in a competitive market, which of the following combination of events could cause the price of the good to increase and the quantity to decrease?
An increase in the average income of consumers and an increase in the price of a variable input
Country Z has a downward sloping domestic demand curve and an upward sloping domestic supply curve for widgets. In the absence of trade, the domestic price of widgets is P0. Now the country engages in trade, and the price for widgets, Pw, is below the domestic price, P0. Which of the following will occur? Responses
Domestic producer surplus will decrease in country Z.
Country Z is both a producer and an importer of green tea. If country Z imposes a tariff on imports of green tea, which of the following will occur in the domestic market of green tea?
Domestic production will increase.
Which of the following is true of a price floor?
The intention of the government in creating the price floor is to assist the producers of the good.
wage increase , employment decrease
If the minimum wage for teenagers increased to a rate higher than their market equilibrium wage, what would be the effect on their wage and employment?
The graph above shows the supply and demand curves for gasoline. Which of the following will occur if the government establishes a price ceiling of $1.20 per gallon?
Neither a surplus nor a shortage
Zucchini is produced in a perfectly competitive market with a downward-sloping demand curve and an upward-sloping supply curve. Dawson Farm is a typical perfectly competitive farm that produces and sells zucchini at the equilibrium price of
No buyer in the market is willing to pay more than $1.75 per pound for zucchini from Dawson Farm.
A decrease in raw material prices will change the equilibrium price and quantity in a market in which of the following ways?
Price decrease, quantity increase
If the government imposes a tariff on imports of cheese, the price and quantity of imported cheese will most likely change in which of the following ways?
Price increase, quantity decrease
What will happen to the price and quantity of footballs as a result of an increase in the price of leather used to make footballs?
Price will increase, and quantity will decrease.
The American Heart Association has just issued a report warning consumers about the negative health effects of eating beef. Which of the following changes in the beef market is most likely to occur as a result?
The demand curve will shift to the left, decreasing the price of beef.
The equilibrium price will remain unchanged, and suppliers will bear the entire burden of the tax.
The fresh fish market is in equilibrium, and the demand is perfectly elastic. The imposition of a per-unit tax on sellers by the government will result in which of the following?
Teenage employment will increase because firms will want to hire more teenagers at W2 than at W1.
The graph above illustrates the labor market for teenage workers. The current minimum wage for all workers is W1. If Congress introduces a sub-minimum wage, W2 that applies only to teenagers, what is the most likely effect on teenage employment?
The graph above shows the supply and demand curves for artichokes. The surgeon general announces that eating an artichoke a day dramatically reduces one's likelihood of developing cancer. Simultaneously an infestation of the artichoke weevil severely damages the crop. Which of the following will definitely occur as a result?
The price of artichokes will increase.
Assume that the government imposes a binding price ceiling on a market for an inferior good. Which of the following is most likely to occur in the market if consumers' incomes increase?
The shortage in the market will decrease.
Country Z is both a producer and an importer of cloth. Which of the following will happen if the government of Country Z imposes a tariff on cloth and the country continues to import some cloth from abroad?
There will be a decrease in consumer surplus for domestic consumers.
Which of the following will occur if the government imposes a price ceiling below the equilibrium price of a good?
There will be a shortage in the market.
In a competition equilibrium consumer surplus is the area of
WYZ
If the supply of fish increases, there will be
a decrease in the price of fish
The efficient market outcome shown in the graph provided is
at price P0, quantity Q0, and total economic surplus is A B C E F J
If a price ceiling is set at P1, which of the following areas represent the resulting consumer surplus, producer surplus, and deadweight loss?
consumer S Producer surplus Dead loss F G I, K, h J
The market for Good Z has relatively elastic supply and demand curves. Market efficiency is attained when
deadweight loss is zero
If a price floor is set at X, the quantity demanded will
decrease from 0S to 0R
Which of the following changes in the demand for and the supply of a good will necessarily result in an increase in both the equilibrium price and quantity of the good in a market?
demand increase, supply no change
When the market is in equilibrium, the total economic surplus is equal to area
f + g + h + i + j + k
