(A) the quantity demanded will be greater than quantity supplied.
(B) demand will be less than supply.
(C) quantity demanded will be less than quantity supplied.
(D) quantity demanded will equal quantity supplied.
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The need for rationing a good arises when?
(A) there is a perfectly inelastic demand for the good.
(B) supply exceeds demand.
(C) demand exceeds supply.
(D) a surplus exists.
A price floor is?
(A) a maximum price usually set by government, that sellers may charge for a good or
service.
(B) a minimum price usually set by government, that sellers must charge for a good
or service.
(C) the difference between the initial equilibrium price and the equilibrium price after a
decrease in supply.
(D) the minimum price that consumers are willing to pay for a good or service.
What is the effect of imposing a fixed per unit tax on a good on its equilibrium price and quantity?
(A) Price falls, quantity rises
(B) Price rises, quantity falls
(C) Both price and quantity fall
(D) Both price and quantity rise
A price ceiling imposed by the government can cause a shortage (excess demand)?
(A) when the price ceiling is above the free (or unregulated) market price
(B) when the price ceiling is below the free (or unregulated) market price
(C) when the price ceiling is equal to the free (or unregulated) market price
(D) either of the above
What will happen to equilibrium price and quantity when both the demand and supply curves shift to the left?
(A) price falls unambiguously but the effect on quantity cannot be determined
(B) both price and quantity falls unambiguously
(C) quantity falls unambiguously but the effect on price cannot be determined
(D) the effect on both price and quantity cannot be determined
What will happen to equilibrium price and quantity when the demand curve shifts to the left and the supply curve shifts to the right?
(A) price falls unambiguously but the effect on quantity cannot be determined
(B) both price and quantity falls unambiguously
(C) quantity falls unambiguously but the effect on price cannot be determined
(D) the effect on both price and quantity cannot be determined
How many different equilibria can obtain when you allow for shifts in the demand and/or the supply curves?
(A) 2
(B) 4
(C) 8
(D) 16