A price ceiling _____________________________.
makes it illegal to charge a higher price than specified
is necessary to maintain market equilibrium
occurs in housing markets only
is more effective when it is higher
A rent ceiling _______________________________.
set above equilibrium price is effective
always increases the quantity of rental units supplied
set below equilibrium price is effective
does not change the market price
A rent ceiling that is effective results in _______________________.
an increase in the supply of housing
a shortage of housing
helping the poor
more housing supplied than demanded
Search activity _____________________________.
decreases when a price ceiling is set on a good
increases when a price ceiling is set on a good
is unnecessary when a black market exists
occurs there is a surplus of the good
The government sets a price floor for corn which is effective. All of the following, except _______________, will occur.
A surplus of corn will be produced.
The corn market is efficient.
Tthe government will buy the corn surplus.
A deadweight loss is created.
When a minimum wage is set above the equilibrium wage rate, ______________________.
search activity decreases
the supply of low-skilled workers decreases
A minimum wage law ____________________.
creates more employment opportunities for low-skilled workers
creates unemployment among low-skilled workers
creates more prosperity among younger people
increases the number of good paying jobs available to young people
Buyers respond only to the price that _______ the tax, and sellers respond to the price that _______ the tax.
If the demand for an agricultural good is inelastic, then a bumper harvest results in a lower price and farm revenue will _________________.
either remain constant or increase
A government price stabilization agency _______ inventory when the price is above the future expected price and _______ inventory when the price is below the future expected price.
sells from; buys for
buys for; sells from
sells from; sells from
buys for; buys for
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