Micro exam 2

Ace your homework & exams now with Quizwiz!

supply curve upward by the amount of the tax .

A tax on sellers will shift the

extent to which buyers alter their quantities demanded in response to changes in prices .

A key determinant of the price elasticity of supply is the

ceiling

A legal maximum on the price at which good can be sold is called a price

price floor .

A legal minimum on the price at which a good can be sold is called a

have no impact on employment .

A minimum wage that is set below a market's equilibrium wage will

below the equilibrium price , causing a shortage .

A price ceiling is binding when it is set

above the equilibrium price .

A price floor will be binding only if it is set

demand curve downward by the amount of the tax .

A tax on buyers will shift the

the quantity demanded of one good changes response to a change . the price of another good .

Cross - price elasticity of demand measures how

greater than 1

Demand is elastic if the price elasticity of demand is

less than 1

Demand is inelastic if the price elasticity of demand is

buyers respond substantially to changes in the price of the good .

Demand is said to be price elastic if

a measure of how much buyers and sellers respond to changes in market conditions 1/1

Elasticity is

there will be no effect on the market price or quantity sold .

If a price ceiling is not binding , then

sellers will bear most of the burden of the tax .

If a tax is imposed on a market with inelastic supply and elastic demand , then

buyers do not respond much to a change in price

If demand is price inelastic , then

price adjusts until quantity demanded equals quantity supplied .

In a competitive market free of government regulation ,

quantity demanded stays the same whenever price changes .

In the case of perfectly inelastic demand ,

the quantity demanded changes as consumer income changes .

Income elasticity of demand measures how

carrots , vegetables , food

Rank these three items in terms of their price elasticity of demand ( ED ) from most price elastic to least price elastic .

panel ( b ) only .

Refer to Figure 6-1 . A binding price ceiling is shown in

panel ( b ) only

Refer to Figure 6-1 . In which panel ( s ) of the figure would there be a shortage of the good at the price ceiling ?

an inferior good

Suppose good X has a negative income elasticity of demand . This implies that good X is

price inelastic ; normal

Suppose season tickets to Minnesota Vikings home games currently have a price elasticity of demand ( ED ) of 0.04 and income elasticity of demand ( El ) of 0.23 . This means that season tickets to Vikings home games are and

Compliments or Substitutes

The cross-price elasticity of demand can tell us whether goods are

quantity demanded responds to a change in price .

The price elasticity of demand measures how much

distribution of the tax burden between buyers and sellers .

The term tax incidence refers to

lower rent and lower quality housing

Under rent control , tenants can expect

toothpaste

Which of the following is likely to have the most price inelastic demand ?

the steepness or flatness of the supply curve for the good

Which of the following is not a determinant of the price elasticity of demand for a good ?

the quantity supplied responds to changes in the price of the good

the price elasticity of supply measures how much


Related study sets

Biology Final Exam (quiz questions)

View Set

Therapeutics - Chapter 32: Skin Integrity and Wound Care

View Set

PowerPoint Multiple Choice Test 94 out of 100

View Set

2 - Doing Ethics from a Christian Perspective

View Set

LC2: LearningCurve: Ch. 2: Supply and Demand

View Set

Microbiology Test 2 Questions 25-50

View Set

Physics 1111 Final Exam Conceptual Review (Chapters 1-10)

View Set