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Table 6-3 The following table contains the demand schedule and supply schedule for a market for a particular good. Suppose sellers of the good successfully lobby Congress to impose a price floor $2 above the equilibrium price in this market. Table 6-3 The following table contains the demand schedule and supply schedule for a market for a particular good. Suppose sellers of the good successfully lobby Congress to impose a price floor $2 above the equilibrium price in this market. -Refer to Table 6-3. How many units of the good are sold after the imposition of the price floor? A) 5 B) 9 C) 10 D) 15 -Refer to Table 6-3. How many units of the good are sold after the imposition of the price floor?


A) 5
B) 9
C) 10
D) 15

E) B) and D)
F) A) and B)

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Which of the following is not correct?


A) Some states in the U.S. mandate minimum wages above the federal level.
B) Most European nations have minimum-wage laws.
C) The U.S. minimum wage is significantly higher than the minimum wages in France and the United Kingdom.
D) The U.S. Congress first instituted a minimum wage with the Fair Labor Standards Act.

E) C) and D)
F) A) and D)

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Figure 6-22 Figure 6-22 -Refer to Figure 6-22. Buyers pay how much of the tax per unit? A) $0.50. B) $1.50. C) $3.00. D) $5.00. -Refer to Figure 6-22. Buyers pay how much of the tax per unit?


A) $0.50.
B) $1.50.
C) $3.00.
D) $5.00.

E) A) and B)
F) All of the above

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In a free market, the price of housing adjusts to eliminate the shortages that give rise to undesirable landlord behavior.

A) True
B) False

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Which of the following is not a short-run effect of rent control on the housing market?


A) reduced rents
B) a large shortage
C) a small increase in quantity demanded
D) a small decrease in quantity supplied

E) B) and D)
F) A) and B)

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Unlike minimum wage laws, wage subsidies


A) discourage firms from hiring the working poor.
B) cause unemployment.
C) help only wealthy workers.
D) raise the living standards of the working poor without creating unemployment.

E) C) and D)
F) A) and B)

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A legal maximum on the price at which a good can be sold is called a price


A) floor.
B) subsidy.
C) support.
D) ceiling.

E) All of the above
F) None of the above

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Workers determine the supply of labor, and firms determine the demand for labor.

A) True
B) False

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Figure 6-24 Figure 6-24 -Refer to Figure 6-24. Andrew is a buyer of the good. Taking the tax into account, how much does Andrew effectively pay to acquire one unit of the good? A) $16 B) $18 C) $24 D) $26 -Refer to Figure 6-24. Andrew is a buyer of the good. Taking the tax into account, how much does Andrew effectively pay to acquire one unit of the good?


A) $16
B) $18
C) $24
D) $26

E) C) and D)
F) B) and D)

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Figure 6-22 Figure 6-22 -Refer to Figure 6-22. Suppose the same supply and demand curves apply, and a tax of the same amount per unit as shown here is imposed. Now, however, the buyers of the good, rather than the sellers, are required to pay the tax to the government. After the buyers pay the tax, relative to the case depicted in the figure, the burden on buyers will be A) larger, and the burden on sellers will be smaller. B) smaller, and the burden on sellers will be larger. C) the same, and the burden on sellers will be the same. D) The relative burdens in the two cases cannot be determined without further information. -Refer to Figure 6-22. Suppose the same supply and demand curves apply, and a tax of the same amount per unit as shown here is imposed. Now, however, the buyers of the good, rather than the sellers, are required to pay the tax to the government. After the buyers pay the tax, relative to the case depicted in the figure, the burden on buyers will be


A) larger, and the burden on sellers will be smaller.
B) smaller, and the burden on sellers will be larger.
C) the same, and the burden on sellers will be the same.
D) The relative burdens in the two cases cannot be determined without further information.

E) A) and C)
F) B) and C)

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The federal government uses the revenue from the FICA (Federal Insurance Contribution Act) tax to pay for


A) unemployment compensation.
B) the salaries of members of Congress.
C) Social Security and Medicare.
D) housing subsidies for low-income people.

E) None of the above
F) A) and B)

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