EBK ESSENTIALS OF ECONOMICS
7th Edition
ISBN: 8220102452107
Author: Mankiw
Publisher: CENGAGE L
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Chapter 6, Problem 1QCMC
To determine
The impact of a binding
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What happens if an effective price floor is placed on the market for steel?
a.
There will be a surplus of steel.
b.
The price of steel will be lower than the equilibrium price.
c.
The quality of steel produced will decrease.
d.
There will be a shortage of steel.
________When there is a shortage of citrus fruit, the economic forces of supply and demand would suggest that a. price will stay constant. b. price will decrease. c. price will increase. d. price, all things remaining equal, will increase. e. it will take a long time before the shortage is felt in the market.
An increase in an effective price ceiling will do what in the relevant market?
a. The surplus will increase.b. The surplus will decrease.c. The shortage will increase.d. The shortage will decrease.
Chapter 6 Solutions
EBK ESSENTIALS OF ECONOMICS
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- In a competitive market, if the government imposes a price ceiling below the equilibrium price, what is likely to happen?A. Surplus of goods B. Shortage of goods C. No change in quantity exchangedD. Price remains the samearrow_forwardThe government imposes a price ceiling below the equilibrium price. Which of the following are the effects of this price ceiling? A. Shortage B. Deadweight loss C. Inefficiently low quality of the good D. Both A and B E. All of the above F. None of the abovearrow_forwardIf a municipality sets a price ceiling below equilibrium for apartments in New York City, Select one: a. the price ceiling will create a surplus of apartments b. the price ceiling will create a shortage of apartments c. the price ceiling will not affect the market for apartments d. the market for more broadway plays will increase Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forward
- If a price ceiling is set below the equilibrium price in a market, A. raioning will be necessary. B. surpluses of the commodity will develop. C. the quantity demanded will exceed the quantity supplied. D. tje quantity supplied willexceed the quantitiy demanded.arrow_forward1. When a price ceiling is imposed in a market, a. a persistent shortage results b. a persistent surplus results c. sellers of the product are made better off d. no one is made better off e. quantity supplied is greater than the quantity demanded 2. All of the following are problems associated with price ceilings except a. chronic excess demand b. an eventual decline in the number of suppliers c. the need to use ration coupons to purchase the good d. chronic excess supply e. landlords failing to maintain rent-controlled properties adequately 3. When a price floor is imposed, it has an impact on a market if it is set a. below the equilibrium price b. at the equilibrium price c. above the equilibrium price because quantity demanded exceeds quantity supplied d. above the equilibrium price because quantity supplied exceeds quantity demanded e. below the equilibrium price because quantity demanded exceeds quantity supplied 4. One lesson to be drawn from our discussion of price ceilings…arrow_forwardConsumers in Nashville purchase fresh tomatoes in the summer. Consumers in Clarksville (nearby) purchase even more tomatoes. Assuming competitive markets, what should happen in Clarksville if Nashville places a tax on Nashville tomato sellers? a. The equilibrium quantity of tomatoes in Clarksville will increase; the equilibrium price will increase. b. The equilibrium quantity of tomatoes in Clarksville will decrease; the equilibrium price will decrease. c. The equilibrium quantity of tomatoes in Clarksville will decrease; the equilibrium price will increase. d. The equilibrium quantity of tomatoes in Clarksville will increase; the equilibrium price will decrease. e. Nothing will likely change in the Clarksville market.arrow_forward
- Which government policy measure would reduce the price of a product and increase the quantity traded in the market? Pick a,b,c or d a. The setting of a maximum price b. The setting of a minimum price c. The imposition of a tax d. The granting of subsidyarrow_forwardWhich of the following will cause a decrease in consumer surplus? a. an increase in the number of sellers of the good b. a decrease in the production cost of the good c. sellers expect the price of the good to be lower next month d. the imposition of a binding price floor in the marketarrow_forwardGraph the following c. People of town X move to town Y. Supply in town X remains the same. Show effects on market price and demand in the former d. Market price of palay is P15/kilo, Government increases it to P20/kilo. Show effects e. A bountiful harvest of rice in the latest harvest season. With demand remaining the same show effects on market price and supply curve. NOTE: PLEASE DON'T DO IT IN HAND-WRITTEN.arrow_forward
- In the market for Widgets, the equilibrium price is $ 20 and the equilibrium quantity is 5000 Widgets, which of the following statements is FALSE? A. None of the above B. If the government sets a price ceiling at $ 15 companies will increase the quantity supplied C. If the government sets the price floor for widgets at $ 25 there will be a surplus of widgets in the market D. If the price ceiling is set at $ 15 there will be a shortage of Widgets in the marketarrow_forwardPeople scalping tickets for the Super Bowl will be successful at selling the tickets for a profit a.when prices are too high. b.only when there is excess supply. c.when the price set by the National Football League is less than the market equilibrium price. d.any time the Super Bowl is popular.arrow_forward1. A binding price floor in a market is removed. Which of the following is likely to occur as a result? SELECT THE CORRECT ANSWER a. The market price will rise. b. The demand for the item will fall. c. The market price will fall. d. The supply of the item will rise. 2. In 2016, Amazon began charging a 5.75% sales tax on products it sells in the District of Columbia. Holding all else constant, the effect of this tax would be to _____ in the District of Columbia. Select the correct answer a. decrease Amazon sales b. decrease prices for local businesses c. decrease the number of consumers d. increase Amazon salesarrow_forward
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