Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Chapter 7, Problem 3MCQ
To determine
To choose: The appropriate option to fill in the blanks in the given statement.
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An increase in a price ceiling will change the amount of a good sold in a market:
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a
if the price ceiling is effective.
b
regardless of whether or not the ceiling is effective.
c
if the price ceiling is ineffective.
d
if demand is inelastic.
1. The Agricultural Society persuades the government, in the interest of food security, to impose a price floor on local carrots in order to keep carrot farmers in the business.
a) Assess the welfare implications of this measure.
b) Assess the effectiveness of this measure in keeping farmers in carrot farming.
2. Discuss two unintended effects of a price ceiling.
do fast.
Chapter 7 Solutions
Foundations of Economics (8th Edition)
Ch. 7 - Prob. 1SPPACh. 7 - Prob. 2SPPACh. 7 - Prob. 3SPPACh. 7 - Prob. 4SPPACh. 7 - Prob. 5SPPACh. 7 - Prob. 6SPPACh. 7 - Prob. 7SPPACh. 7 - Prob. 8SPPACh. 7 - Prob. 9SPPACh. 7 - Prob. 10SPPA
Ch. 7 - Prob. 11SPPACh. 7 - Prob. 1IAPACh. 7 - Prob. 2IAPACh. 7 - Prob. 3IAPACh. 7 - Prob. 4IAPACh. 7 - Prob. 5IAPACh. 7 - Prob. 6IAPACh. 7 - Prob. 7IAPACh. 7 - Prob. 8IAPACh. 7 - Prob. 9IAPACh. 7 - Prob. 1MCQCh. 7 - Prob. 2MCQCh. 7 - Prob. 3MCQCh. 7 - Prob. 4MCQCh. 7 - Prob. 5MCQCh. 7 - Prob. 6MCQCh. 7 - Prob. 7MCQCh. 7 - Prob. 8MCQ
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- A). Draw the supply and demand curves for the market of specific good. B). Suppose that the equilibrium price for this product is $4 and the equilibrium quantity is 100 units. If the government imposes a price ceiling of $3 what happens? Draw the new graph explaining how quantities are affected by that decision. C). Suppose that the equilibrium price for this product is $4 and the equilibrium quantity is 100 units. If the government imposes a price floor of $5 what happens? Draw the new graph explaining how quantities are affected by that decision.arrow_forwardHelp!arrow_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
- The government imposes a price floor in the market for peanuts in order to stabilize or raise farmer's incomes. a) what is the impact on consumer surplus and producer surplus. b) what would happen to the quantity demanded and the quantity supplied of peanuts? c) would the amount of market exchange increase or decrease or remain the same. Please support answers with graph and explain.arrow_forward. Which statement best explains how a price ceiling affects the market for gasoline? It can cause more gasoline producers to enter the market. It can lead to producers increasing their production costs for gasoline. It can cause shortages in the supply of gasoline. It can lead to a decrease in the demand from consumers for gasoline.arrow_forward6. What would happen to the market if the price ceiling was set above the equilibrium?arrow_forward
- An effective price ceiling: A. Increases the quantity supplied. B. Is set above the equilibrium price. C. Results in a surplus. D. Is set below the equilibrium price.arrow_forwardIf a price floor is imposed at $15 per unit when the equilibrium market price is $12, there will be options: A. no surplus or shortage. B. a surplus. C. a shortage. D. a downward pressure on prices. E. an upward pressure on prices.arrow_forwardWhen an effective price ceiling is removed, we would expect the price of the good to: a. increase and the quantity demanded to decrease. b. increase and the quantity demanded to increase. c. decrease and the quantity demanded to decrease. d. decrease and the quantity demanded to increase. Only typed answerarrow_forward
- The equilibrium price in the market for rental housing is $1,000. Which of the following price control policies will lead to an excess demand (where the quantity demanded is higher than the quantity supplied.) Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. A price floor set higher than $1,000. a b A price ceiling set higher than $1,000. A price floor lower than $1,000. A price ceiling set lower than $1,000.arrow_forwardA price ceiling: a. would be imposed if the government believes the market equilibrium price is too low. b. is the lowest price that the law will allow to be charged in the market. c. is the price that must be charged in the market. d. is the highest price that the law will allow to be charged in the market.arrow_forwarda. Price ceilings create shortages if they are set b. Which of the following are price ceilings? the minimum wage price controls on prescription drugs an agricultural price support rent control below the equilibrium price.arrow_forward
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