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- 1. Multiple Choice
When a price ceiling is in place keeping the price below the market price, which is true of the quantity demanded & quantity supplied?
Quantity Demanded is greater
Quantity Supplied is greater
Quantity Demanded equals Quantity supplied
- 2. Multiple Choice
What is the equilibrium QUANTITY in this graph?
$1.50
$1.00
600
800
- 3. Multiple ChoiceAt the price of 1.00 there is ashortage of 200surplus of 200shortage of 400surplus of 400
- 4. Multiple ChoiceAn effective price floor must be set above equilibrium, resulting in:a shortagea surpluslimited choicesNone of the above
- 5. Multiple ChoiceIf the government set the price at $700, would that be a price ceiling or floor?Price CeilingPrice FloorNeither
- 6. Multiple ChoiceIf the government set the price at $300, what would be the result?Surplus of 4,000Surplus of 2,000Shortage of 4,000Shortage of 2,000
- 7. Multiple Choice
What would result if the price were set at $1.75
Surplus, Quantity Supplied is greater
Shortage, Quantity Demanded is greater
Quantity Supplied = Quantity Demanded
$1.75
- 8. Multiple ChoiceAssume an effective price floor is placed on the sale of this product. What is the new price & quantity purchased?P1, Q2P2, Q2P3, Q3P1, Q1
- 9. Multiple ChoiceAssume an effective price floor is placed on the sale of this product. What letters correspond to the deadweight loss?ABCDEFCEBD
- 10. Multiple ChoiceIf the government creates a price ceiling of $30, which one of the following statements is correct?The quantity demanded = 60The quantity supplied = 160There is a surplus of 100There is a shortage of 100
- 11. Multiple ChoiceIf the government creates a price floor of $80, which one of the following statements is correct?The quantity demanded = 60The quantity supplied = 180There is a shortage of 140There price floor is ineffective
- 12. Multiple ChoiceSuppose the mayor of this city imposes a price ceiling at $5.50. How large is the shortage of rides?1 million2 million3 million4 million
- 13. Multiple ChoiceSuppose the mayor of this city sets a quota limit of rides at 10 million per year. What is the quota rent?$0.50$1.00$1.50$2.00
- 14. Multiple ChoiceIf an effective rent ceiling is eliminated, which of the following is most likely to occur in the rental housing market?An increase in the demand for housing, resulting in a decrease in the quantity of housing suppliedAn increase in the demand for housing, resulting in an increase in the quantity of housing demandedAn increase in rents, resulting in an increase in the quantity of housing suppliedA decrease in rents, resulting in an increase in the quantity of housing supplied
- 15. Multiple ChoiceIf there is a price ceiling set at P1, consumer surplus will be represented by the area:A, B, CP2, B, P0P3, B, P2P3, A, C, P1
- 16. Multiple ChoiceThe diagram depicts demand and supply curves in a city’s rental housing market. If a price ceiling of $1,000 is imposed on the market, which of the following will occur?There will be a surplus of rental housing in the city.The demand curve for housing will shift to the right.The quantity of rental housing demanded will increase.The supply curve for housing will shift to the right.
- 17. Multiple ChoiceWhen a price ceiling is imposed in a market:A persistent surplus resultsSellers of the product are made better offA persistent shortage resultsQuantity supplied is greater than the quantity demanded
- 18. Multiple ChoiceWhen a price floor is imposed, it has an impact on a market if it is set:Below the equilibrium priceAbove the equilibrium price because quantity supplied exceeds quantity demandedAbove the equilibrium price because quantity demanded exceeds quantity suppliedAt the equilibrium price
- 19. Multiple Choice
When a price ceiling is in place keeping the price below the market price, which is true of the quantity demanded & quantity supplied?
Quantity Demanded is greater
Quantity Supplied is greater
Quantity Demanded equals Quantity supplied
- 20. Multiple ChoiceAt the price of 1.00 there is ashortage of 200surplus of 200shortage of 400surplus of 400
- 21. Multiple ChoiceAn effective price floor must be set above equilibrium, resulting in:a shortagea surpluslimited choicesNone of the above
- 22. Multiple ChoiceIf the government set the price at $700, would that be a price ceiling or floor?Price CeilingPrice FloorNeither
- 23. Multiple ChoiceIf the government set the price at $300, what would be the result?Surplus of 4,000Surplus of 2,000Shortage of 4,000Shortage of 2,000
- 24. Multiple ChoiceIf the government creates a price floor of $80, which one of the following statements is correct?The quantity demanded = 60The quantity supplied = 180There is a shortage of 140There price floor is ineffective
- 25. Multiple ChoiceIf the government creates a price ceiling of $30, which one of the following statements is correct?The quantity demanded = 60The quantity supplied = 160There is a surplus of 100There is a shortage of 100
- 26. Multiple Choice
What would result if the price were set at $1.75
Surplus, Quantity Supplied is greater
Shortage, Quantity Demanded is greater
Quantity Supplied = Quantity Demanded
$1.75
- 27. Multiple Choice
Which of the following is the most likely explanation for the imposition of a minimum price in the market for corn?
Sellers of corn, recognizing that the price floor is good for them, have pressured policy makers into enacting the price floor.
Buyers of corn, recognizing that the price floor is good for them, have pressured policy makers into enacting the price floor.
Buyers and sellers of corn have agreed that the price floor is good for both of them and have therefore pressured policy makers into enacting the price floor.
Policy makers have studied the effects of the price floor carefully and recognize that the price floor is advantageous for society as a whole.
- 28. Multiple Choice
An effective maximum price will benefit
all consumers.
some consumers at the expense of other consumers.
all producers.
some producers at the expense of other producers.
- 29. Multiple ChoicePrice ceilings lead to ___________ and price floors lead to ___________.surplus;shortageshortage;surplus
- 30. Multiple Choice
Suppose the government sets a price ceiling of $80. How large will the shortage be?
5 million coats
4 million coats
3 million coats
2 million coats
- 31. Multiple Choice
During a crisis such as Hurricane Katrina, governments often make it illegal to raise the price of emergency items like flashlights and bottled water. In practice, this means that these items get sold on a first-come, first-served basis. If a person has a flashlight that she values at $5, but its price on the black market is $40, what gains from trade are lost if the government shuts down the black market?
$45
$30
$35
$25
- 32. Multiple Choice
If a government decided to impose price controls on gasoline, what could it do to avoid the time wasted waiting in lines? Though there are several solutions to this problem, only one of the options below is correct.
Restrict gasoline consumption to high-value uses.
Ban lines for gasoline.
Create gasoline rations.
Ban black markets for gasoline.
- 33. Multiple Choice
A review of the jargon: Is the minimum wage a “price ceiling” or a “price floor?
price ceiling
price floor
- 34. Multiple Choice
A review of the jargon: Is rent control a “price ceiling” or a “price floor?”
price ceiling
price floor
- 35. Multiple Choice
Harry is lucky enough to get a rent-controlled apartment for $300 per month. The market rent on such an apartment is $3,000 per month. Harry himself values the apartment at $2,000 per month, and he’d be quite happy with a regular, $2,000 per month New York apartment. If he stays in the apartment, how much consumer surplus does he enjoy?
$2000
$1700
$2100
$2400
- Answer choicesTagsAnswer choicesTags