ch10 - File ch10 Chapter 10 Competitive Markets Applications Multiple Choice 1 1 An analysis that determines the equilibrium prices and quantities in

ch10 - File ch10 Chapter 10 Competitive Markets...

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File: ch10, Chapter 10: Competitive Markets: Applications Multiple Choice 1.1.An analysis that determines the equilibrium prices and quantities in one market holding constant prices in all other markets is calleda. a)partial equilibrium analysisb.b)general equilibrium analysisc.c)externality analysisd.d)market equilibrium analysisAns: A Difficulty: Easy Heading: The Invisible Hand, Excise Taxes and Subsidies LO 1 Analyze the consequences of many forms of government intervention in perfectly competitive markets, including the impositions of excise taxes, subsidies to producers, price ceilings, price floors, production quotas, and import tariffs and quotas. a. 2.Identify the truthfulness of the following statements. a.I.The profit in a perfectly competitive market is the one that maximizes the economic benefits (the sum of consumer and producer surplus).b.II.In a way, statement I represents the “invisible hand” of the marketplace that Adam Smith was discussing in his 1776 classic treatise sometimes referred to as “The Wealth of Nations.” Difficulty: Medium Heading: The Invisible Hand, Excise Taxes and Subsidies LO 1 Analyze the consequences of many forms of government intervention in perfectly competitive markets, including the impositions of excise taxes, subsidies to producers, price ceilings, price floors, production quotas, and import tariffs and quotas. a. 3.The incidence of a tax depends onb. Difficulty: Easy Heading: The Invisible Hand, Excise Taxes and Subsidies LO 1 Analyze the consequences of many forms of government intervention in perfectly competitive markets, including the impositions of excise taxes, subsidies to producers, price ceilings, price floors, production quotas, and import tariffs and quotas. a. 4.If the government decides to subsidize a good, it will typically do all of the following except: Difficulty: Easy Heading: The Invisible Hand, Excise Taxes and Subsidies
LO 1 Analyze the consequences of many forms of government intervention in perfectly competitive markets, including the impositions of excise taxes, subsidies to producers, price ceilings, price floors, production quotas, and import tariffs and quotas. a.

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