Misc Quiz On Microeconomics
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There are a lot of factors that affect the economy as it is and one of the major ones is demand, supply, and government policies that affect the industries in existence or block others from existing. What do you know about these factors and their impact on the economy? Take up this Misc quiz on microeconomics and get to find out!
- 1.
- A.
True
- B.
False
- 2.A price ceiling set below the equilibrium price causes a surplus
- A.
True
- B.
False
- 3.A price floor set above the equilibrium price is a binding constraint
- A.
True
- B.
False
- 4.The shortage of housing caused by a binding rent control is likely to be more severe in the long run when compared to the short run
- A.
True
- B.
False
- 5.The minimum wage helps all teenagers because they receive higher wages than they would otherwise
- A.
True
- B.
False
- 6.A 10 percent increase in the minimum wage causes a 10 percent reduction in teenage employment
- A.
True
- B.
False
- 7.A price ceiling that is not a binding constraint today could cause a shortage in the future if demand were to increase and raise the eqilibrium price above the frixed price ceiling.
- A.
True
- B.
False
- 8.A price floor in a market always creates a surplus in that market
- A.
True
- B.
False
- 9.A $10 tax on baseball gloves will always raise the price that the buyers pay for baseball gloves by $10
- A.
True
- B.
False
- 10.The ultimate burden of a tax lands more heavily on the side of the market that is less elastic
- A.
True
- B.
False
- 11.When we use the model of supply and demand to analyze a tax collected form the buyers, we shift the demand curve upward by the size of the tax
- A.
True
- B.
False
- 12.If medicine is a necessity, the burden of a tax on medicine will likely land more heavily on the buyers of medicine
- A.
True
- B.
False
- 13.A tax creates a tax wedge between a buyer and a seller. This causes the price paid by the buyer to rise, the price received by the seller to fall, and the quantity sold to fall
- A.
True
- B.
False
- 14.The government can choose to place the burden of a tax on the buyers in a market by collecting the tax from the buyers rather than the sellers
- A.
True
- B.
False
- 15.A tax collected from buyers has an equivilant impact to a same size tax collected from sellers
- A.
True
- B.
False
- 16.For a price ceiling to be a binding constraint on the market, the government must set it
- A.
Above the equilibrium price
- B.
Below the equilibrium price
- C.
Precisely at the equilibrium price
- D.
At any price because all price ceilings are binding constraints
- 17.A binding price ceiling creates
- A.
A shortage
- B.
A surplus
- C.
An equilibrium
- D.
A shortage or surplus depending on whether the price ceiling is set above or below the equlibrium price
- 18.
- A.
There will be a shortage of housing
- B.
Landlords may discriminate among apartment renters
- C.
Landlords may be offered bribes to rent apartments
- D.
The quality of apartments will improve
- E.
There may be long lines of buyers waiting for apartments
- 19.A price floor
- A.
Sets a legal maximum on the price at which a good can be sold
- B.
Set a legal minimum on the price at which a good can be sold
- C.
Always determines the price at which a good must be sold
- D.
Is not a binding constraint if it is set above the equilibrium price
- 20.
- A.
The surplus created by the price ceiling is greater in the short run than in the long run
- B.
The surplus created by the price ceiling is greater in the long run than in the short run
- C.
The shortage created by the price ceiling is greater in the short run than in the long run
- D.
The shortage created by the price ceiling is greater in the long run than in the short run
- 21.Which side of the market is more likely to lobby government for a price floor?
- A.
Neither buyers nor sellers desire a price floor
- B.
Both buyers and sellers desire a price floor
- C.
The sellers
- D.
The buyers
- 22.Which of the following is an example of a price floor?
- A.
Rent controls
- B.
Restricting gasoline prices to $1.00 per gallon when the equilibrium price is $1.50 per gallon
- C.
The minimum wage
- D.
All of the above are price floors
- 23.
- A.
There will be a shortage of gasoline
- B.
There will be a surplus of gasoline
- C.
A significant increase in the supply of gasoline could cause the price ceiling to become a binding constraint
- D.
A significant increase in the demand for gasoline could cause the price ceiling to become a binding constraint
- 24.Studies show that a 10 percent increase in the minimum wage
- A.
Decreases teenage employment by about 10 to 15 percent
- B.
Increases teenage employment by about 10 to 15 percent
- C.
Decreases teenage employment by about 1 to 3 percent
- D.
Increases teenage employment by about 1 to 3 percent
- 25.
- A.
Demand curve upward by the size of the tax per unit
- B.
Demand curve downward by the size of the tax per unit
- C.
Supply curve upward by the size of the tax per unit
- D.
Supply curve downward by the size of the tax per unit
- 26.Within the supply-and-demand model, a tax collected from the sellers of a good shifts the
- A.
Demand curve upward by the size of the tax per unit
- B.
Demand curve downward by the size of the tax per unit
- C.
Supply curve upward by the size of the tax per unit
- D.
Supply curve downward by the size of the tax per unit
- 27.Which of the following takes place when a tax is placed on a good?
- A.
An increase in the price buyers pay, a decrease in the price sellers receive, and a decrease in the quantity sold
- B.
An increase in the price buyers pay, a decrease in the price sellers receive, and an increase in the quantity sold
- C.
A decrease in the price buyers pay, an increase in the price sellers receive, and a decrease in the quantity sold
- D.
A decrease in the price buyers pay, an increase in the price sellers receive, and an increase in the quantity sold
- 28.When a tax is collected from the buyers in a market,
- A.
The buyers bear the burden of the tax
- B.
The sellers bear the burden of the tax
- C.
The tax burden on the buyers and sellers is the same as an equivalent tax collected from he sellers
- D.
The tax burden falls most heavily on the buyers
- 29.A tax of $1.00 per gallon on gasoline
- A.
Increases the price the buyers pay by $1.00 per gallon
- B.
Decreases the price the sellers receive by $1.00 per gallon
- C.
Increases the price the buyers pay by precisely $.50 and reduces the price received by sellers by precisely $.50
- D.
Places a tax wedge of $1.00 between the price the buyers pay and the price the sellers receive
- 30.The burden of a tax falls more heavily on the sellers in a market when
- A.
A demand is inelastic and supply is elastic
- B.
Demand is elastic and supply is inelastic
- C.
Both supply and demand are elastic
- D.
Both supply and demand are inelastic
- 31.A tax is placed on a good that is a necessity for consumers will likely generate a tax burden that
- A.
Falls more heavily on buyers
- B.
Falls more heavily on sellers
- C.
Is evenly distributed between buyers and sellers
- D.
Falls entirely on sellers
- 32.The burden of a tax falls more heavily on the buyers in a market when
- A.
Demand is inelastic and supply is elastic
- B.
Demand is elastic and supply is inelastic
- C.
Both supply and demand are elastic
- D.
Both supply and demand are inelastic
- 33.Which of the following statements about the burden of a tax is correct?
- A.
The tax burden generated from a tax placed on a good consumers perceive to be a necessity will fall most heavily on the sellers of the good
- B.
The tax burden falls heavily on the side of the market (buyers or sellers) that is most willing to leave the market when price movements are unfavorable to them
- C.
The burden of a tax lands on the side of the market (buyers or sellers) from which it is collected
- D.
The distribution of the burden of a tax is determined by the relative elasticities of supply and demand and is not determined by legislation
- 34.For which of the following products would the burden of a tax likely fall more heavily on the sellers?
- A.
Food
- B.
Entertainment
- C.
Clothing
- D.
Housing
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