Chapter 6 Supply, demand, and government policies - Global Econ - concordia college

A binding minimum wage a. alters both the quantity demanded and quantity supplied of labor. b. affects only the quantity of labor demanded; it does not affect the quantity of labor supplied. c. has no effect on the quantity of labor demanded or the quantity of labor supplied. d. causes only temporary unemployment because the market will adjust and eliminate any temporary surplus of workers.

a. alters both the quantity demanded and quantity supplied of labor.

Although lawmakers legislated a fifty-fifty division of the payment of the FICA tax, a. the actual tax incidence is unaffected by the legislated tax incidence. b. the employer now is required by law to pay more than 50 percent of the tax. c. the employee now is required by law to pay more than 50 percent of the tax. d. employers are no longer required by law to pay any portion of the tax.

a. the actual tax incidence is unaffected by the legislated tax incidence.

​Suppose that a binding rent control law is repealed in San Francisco. As a result, we would expect the total number of units rented in the city to a. ​increase. b. ​decrease. c. ​remain unchanged. d. ​decrease, then increase.

a. ​increase.

Question text A nonbinding price ceiling (i) causes a surplus. (ii) causes a shortage. (iii) is set at a price above the equilibrium price. (iv) is set at a price below a. (i) only b. (iii) only c. (i) and (iii) only d. (ii) and (iv) only

b. (iii) only

A tax burden falls more heavily on the side of the market that a. has a fewer number of participants. b. is more inelastic. c. is closer to unit elastic. d. is less inelastic.

b. is more inelastic.

The tax burden will fall most heavily on sellers of the good when the demand curve a. is relatively steep, and the supply curve is relatively flat. b. is relatively flat, and the supply curve is relatively steep. c. and the supply curve are both relatively flat. d. and the supply curve are both relatively steep.

b. is relatively flat, and the supply curve is relatively steep

A shortage results when a a. nonbinding price ceiling is imposed on a market. b. nonbinding price ceiling is removed from a market. c. binding price ceiling is imposed on a market. d. binding price ceiling is removed from a market.

c. binding price ceiling is imposed on a market.

A $1.50 tax levied on the buyers of pomegranate juice will shift the demand curve a. upward by exactly $1.50. b. upward by less than $1.50. c. downward by exactly $1.50. d. downward by less than $1.50.

c. downward by exactly $1.50.

Suppose the equilibrium price of a physical examination ("physical") by a doctor is $200, and the government imposes a price ceiling of $150 per physical. As a result of the price ceiling, the a. demand curve for physicals shifts to the right. b. supply curve for physicals shifts to the left. c. quantity demanded of physicals increases, and the quantity supplied of physicals decreases. d. number of physicals performed stays the same.

c. quantity demanded of physicals increases, and the quantity supplied of physicals decreases.

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

c. supply of labor, that is, unemployment.

A binding minimum wage tends to Select one: a. cause a labor surplus. b. cause unemployment. c. have the greatest impact in the market for teenage labor. d. All of the above are correct.

d. All of the above are correct.

As a rationing mechanism, discrimination according to seller bias is a. efficient and fair. b. efficient, but potentially unfair. c. inefficient, but fair. d. inefficient and potentially unfair.

d. inefficient and potentially unfair.

Rent control policies tend to cause a. relatively smaller shortages in the short run than in the long run because supply and demand tends to be more elastic in the short run than in the long run. b. relatively larger shortages in the short run than in the long run because supply and demand tends to be more elastic in the short run than in the long run. c. relatively larger shortages in the short run than in the long run because supply and demand tends to be more inelastic in the short run than in the long run. d. relatively smaller shortages in the short run than in the long run because supply and demand tends to be more inelastic in the short run than in the long run.

d. relatively smaller shortages in the short run than in the long run because supply and demand tends to be more inelastic in the short run than in the long run.