econ chapter 6

A $1 per unit tax levied on consumers of a good is equivalent to a. a price ceiling that raises the good's price by $1 per unit. b. a $1 per unit tax levied on producers of the good. c. a $1 per unit subsidy paid to producers of the good. d. a price floor that raises the good's price by $1 per unit.

b. a $1 per unit tax levied on producers of the good.

An increase in the minimum wage reduces the total amount paid to the affected workers if the price elasticity of ________ is ________ than one. a. supply, less b. demand, greater c. supply, greater d. demand, less

b. demand, greater

Rent control causes larger shortages in the ________ run because over that time horizon, supply and demand are ________ elastic. a. long, more b. long, less c. short, less d. short, more

a. long, more

When a good is taxed, the burden of the tax falls mainly on consumers if a. supply is elastic and demand is inelastic. b. the tax is levied on consumers. c. the tax is levied on producers. d. supply is inelastic and demand is elastic.

a. supply is elastic and demand is inelastic

When the government imposes a binding price floor, it causes a. the supply curve to shift to the left. b. a surplus of the good to develop. c. the demand curve to shift to the right. d. a shortage of the good to develop.

b. a surplus of the good to develop.

Which of the following increases quantity supplied, decreases quantity demanded, and increases the price that consumers pay? a. the passage of a tax on a good b. the repeal of a tax on a good c. the removal of a binding price floor d. the imposition of a binding price floor

d. the imposition of a binding price floor

Which of the following increases quantity supplied, increases quantity demanded, and decreases the price that consumers pay? a. the removal of a binding price floor b. the passage of a tax on a good c. the imposition of a binding price floor d. the repeal of a tax on a good

d. the repeal of a tax on a good

In a market with a binding price ceiling, increasing the ceiling price will a. decrease the surplus. b. increase the shortage. c. increase the surplus. d. decrease the shortage.

d. decrease the shortage.