The following TWO questions refer to the supply and demand curves illustrated below. Price P2 P3 Quantity 1. A price ceiling of P3 causes: a) A deadweight loss triangle whose comers are ABC. b) A deadweight loss triangle whose corners are ACD. c) A deadweight loss triangle whose comers are BEC. d) A dcadweight loss triangle whose comers are CDE. 2. A price floor of PI causes: a) Excess demand equal to the distance AB. b) Excess supply equal to the distance AB. c) Excess supply equal to the distance DE d) Excess demand equal to the distance DE. 3. Which of the following statements about price ceilings is TRUE? a) Price ceilings make sellers worse off. b) Price ceilings make buyers better off. c) Both a) and b) are true. d) Neither a) nor b is true). 4. Which of the following statements about minimum wages is true? a) Minimum wage laws may make some workers better off and others worse off. b) Minimum wage laws make employers worse off. c) Both a) and b) are truc. d) None of the above are true.

The following TWO questions refer to the supply and demand curves illustrated below. Price P2 P3 Quantity 1. A price ceiling of P3 causes: a) A deadweight loss triangle whose comers are ABC. b) A deadweight loss triangle whose corners are ACD. c) A deadweight loss triangle whose comers are BEC. d) A dcadweight loss triangle whose comers are CDE. 2. A price floor of PI causes: a) Excess demand equal to the distance AB. b) Excess supply equal to the distance AB. c) Excess supply equal to the distance DE d) Excess demand equal to the distance DE. 3. Which of the following statements about price ceilings is TRUE? a) Price ceilings make sellers worse off. b) Price ceilings make buyers better off. c) Both a) and b) are true. d) Neither a) nor b is true). 4. Which of the following statements about minimum wages is true? a) Minimum wage laws may make some workers better off and others worse off. b) Minimum wage laws make employers worse off. c) Both a) and b) are truc. d) None of the above are true.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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