Chapter 6 - Chapter 6 Government Actions in Markets Price...

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Chapter 6: Government Actions in Markets Price ceiling: a regulation that makes it illegal to charge a price higher than a specified level Rent ceiling: a regulation that makes it illegal to charge a rent higher than a specified level Search activity: the time spent looking for someone with whom to do business Black market: an illegal market in which the price exceeds the legally imposed price ceiling Price floor: a regulation that makes it illegal to trade at a price lower than a specified level Minimum wage: a regulation that makes the hiring of labor below a specified wage rate illegal. The lowest wage at which a firm may legally hire a labor Tax incidence: the division of the burden of the tax between the buyer and the seller Production quota: an upper limit to the quantity of a good that may be produced in a specified period Subsidy: a payment made by the government to a producer Chapter 7: Global Markets in Action Imports: the goods and services that we buy from people in other countries Exports: the goods and services that we sell to people in other countries Tariff: a tax that is imposed by the importing country when an imported good crosses its international boundary Import quota: a restriction that limits the maximum quantity of a good that may be imported in a given period Infant-industry argument: the argument that it is necessary to protect a new industry to enable it to grow into a
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