ECON HW5

b.FALSE

A binding minimum wage may not help all workers, but it does not hurt any workers. a. TRUE b. FALSE

C. ability of buyers to obtain the quantity they desire.

A demand curve reflects each of the following except the A. value each buyer in the market places on the good. B. highest price buyers are willing to pay for each quantity. C. ability of buyers to obtain the quantity they desire. D. willingness to pay of all buyers in the market.

b.FALSE

A tax of $1 on buyers always decreases the equilibrium price by $1. a. TRUE b. FALSE

a. TRUE

A tax of $1 on buyers shifts the demand curve downward by exactly $1. a. TRUE b. FALSE

B. emphasize the low annual incomes of those who work for the minimum wage.

Advocates of the minimum wage A. deny that the minimum wage produces any adverse effects. B. emphasize the low annual incomes of those who work for the minimum wage. C. emphasize the benefits to teenagers of increases in the minimum wage. D. All of the above are correct.

b.FALSE

All else equal, a decrease in demand will cause an increase in producer surplus. a. TRUE b. FALSE

b.FALSE not all the goods, shortage

Binding price ceilings benefit consumers because they allow consumers to buy all the goods they demand at a lower price. a. TRUE b. FALSE

B. a decrease in the shortage of organs for transplant.

If the government allowed a free market in organs for transplant there would be A. an increase in the waiting period for transplant organs. B. a decrease in the shortage of organs for transplant. C. a decrease in producer surplus. D. an decrease in consumer surplus

C. $18.

Refer to Figure 6-23. How much tax revenue does this tax produce for the government? A. $36. B. $30. C. $18. D. $6.

see hw5 star C. D2, and the supply is S2. flat supply, steep demand.

Refer to Figure 6-29. The buyers will bear a higher share of the tax burden than sellers if the demand is A. D2, and the supply is S1. B. D1, and the supply is S1. C. D2, and the supply is S2. D. D1, and the supply is S2.

D. $4,800

Refer to Figure 7-13. If the equilibrium price rises from $60 to $120, what is the additional producer surplus to initial producers in the market? A. $3,600 B. $1,200 C. $2,400 D. $4,800

D. Sam's consumer surplus is $30 and total consumer surplus is $90.

Refer to Table 7-1. If the market price is $105, A. Lori's consumer surplus is -$2 and total consumer surplus is $100. B. Calvin's consumer surplus is $45 and total consumer surplus is $85. C. Andrew's consumer surplus is $15 and total consumer surplus is $67.50. D. Sam's consumer surplus is $30 and total consumer surplus is $90. Table 7-1 Buyer Willingness To Pay Calvin $150.00 Sam $135.00 Andrew $120.00 Lori $100.00

C.$300

Refer to Table 7-11. If the market price is $1,000, the producer surplus in the market is A. $1000. B. $1,700. C. $300. D. $700. Table 7-11 The following table represents the costs of five possible sellers. Seller Cost Abby $1,600 Bobby $1,300 Dianne $1,100 Evaline $900 Carlos $800

A. buyers' willingness to pay less the sellers' costs.

Total surplus measures the A. buyers' willingness to pay less the sellers' costs. B. loss to buyers from paying higher prices plus the benefit to sellers from receiving lower prices. C. fairness of the distribution of resources in society. D. value to the government of goods and services sold in society.

B. The short-run effect of rent control is a relatively small shortage of apartments, and the long-run effect of rent control is a larger shortage of apartments.

Which of the following statements about the effects of rent control is correct? A. The short-run effect of rent control is a surplus of apartments, and the long-run effect of rent control is a shortage of apartments. B. The short-run effect of rent control is a relatively small shortage of apartments, and the long-run effect of rent control is a larger shortage of apartments. C. In the long run, rent control leads to a shortage of apartments and an improvement in the quality of available apartments. D. The effects of rent control are very noticeable to the public in the short run because the primary effects of rent control occur very quickly.