A Misc Quiz On Microeconomics

34 Questions | Total Attempts: 1406

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A Misc Quiz On Microeconomics

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!


Questions and Answers
  • 1. 
    If the equlibrium price of gasoline is $1.00 per gallon and the government places a price ceiling on gasoline of $1.50 per gallon, the result will be a shortage of gasoline
    • 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. 
    Suppose the equlibrium price for apartments is $500 per month and the government imposes ren controls of $250. Which of the following is unlikely to occur as a result of the rent controls?
    • 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. 
    Which of the following statements about a binding price ceiling is true?
    • 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. 
    Which of the following statements is true if the government places a price ceiling on gasoline at $1.50 per gallon and the equilibrium price is $1.00 per gallon?
    • 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. 
    Within the supply-and-demand model, a tax collected from the buyers 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