EC2106F08PM2 - Name: _ Class: _ Date: _ ID: A Practice...

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Name: ________________________ Class: ___________________ Date: __________ ID: A 1 Practice Midterm 2 Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. ____ 1. What is not possible consequence if the city council of Atlanta places a price ceiling below the equilibrium rent in order to help some poor GT students? a. GT students will be better off because of a possibly lowered monthly rent fee. b. GT students could be discriminated in the sense that they are not in the property owners’ favorable renters. c. GT students may not see a quick maintenance for their apartment. d. GT students might want to pay a normal rent fee because of an unintended adverse effects of the price ceiling. ____ 2. A binding price floor - minimum price - in a market is set a. above equilibrium price and causes a supply shortage. b. above equilibrium price and causes a supply surplus. c. below equilibrium price and causes a supply surplus. d. below equilibrium price and causes a supply shortage. Figure 6-4 ____ 3. Refer to Figure 6-4 . Suppose a price ceiling of $5 is imposed. As a result, a. there is a shortage of 15 units of the good. b. the demand curve will shift to the left so as to now pass through the point (Q = 40, P = $5). c. the situation is very much like the one created by a binding minimum wage. d. the quantity of the good that is bought and sold is the same as it would have been had a price floor of $7 been imposed.
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Name: ________________________ ID: A 2 Figure 6-6 ____ 4. Refer to Figure 6-6 . When the price ceiling applies in this market and the supply curve for gasoline shifts from S 1 to S 2 , a. the price will increase to P 3 . b. a supply surplus will occur at the new market price of P 2 . c. the market price will stay at P 1 due to the price ceiling. d. a supply shortage will occur at the price ceiling of P 2 . ____ 5. Advocates of the minimum wage a. deny that the minimum wage produces any adverse effects. b. emphasize more drop-outs of teenagers due to increases in the minimum wage. c. emphasize the increase in annual incomes of those who work for the minimum wage. d. All of the above are correct.
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Name: ________________________ ID: A 3 Figure 6-8 ____ 6. Refer to Figure 6-8 . The burden of the tax on sellers is a. $1.00 per unit. b. $1.50 per unit. c. $2.00 per unit. d. $3.00 per unit. ____ 7. A tax imposed on the sellers of a good will a. raise the price paid by buyers and lower the equilibrium quantity. b. raise the price paid by buyers and raise the equilibrium quantity. c. raise the effective price received by sellers and raise the equilibrium quantity. d. raise the effective price received by sellers and lower the equilibrium quantity.
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Name: ________________________ ID: A 4 Figure 6-10 ____ 8. Refer to Figure 6-10 . From this tax the government will collect a total of a. $125.00. b.
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EC2106F08PM2 - Name: _ Class: _ Date: _ ID: A Practice...

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