Price Controls & Market Structures

At market equilibrium there is

• a shortage
• excess demand
• the same amount of supply and demand
•  a surplus

What is the equilibrium quantity in this graph?

• $1.50
• $1.00
• 600
• 800

If a price floor was set at 320, what quantity would be purchased?

• 20
• 40
• 60
• 80

At the price of 1.00 there is a 

• shortage of 200
• surplus of 200
• shortage of 400
• surplus of 400

An effective price floor must be set above equilibrium, resulting in:

• a shortage
• a surplus
• limited choices
• None of the above

The maximum legal price that can be charged is called a 

• price ceiling
• price floor
• price fan
• price stair 

Characteristics of equilibrium include

• where supply and demand intersect
•  where QS = QD
• no shortage and no surplus
• all of these

Price ceilings lead to ___________ and price floors lead to ___________.

• surplus;shortage
• shortage;surplus

What is not a characteristic of monopolistic competition? 

• many sellers
• easy market entry
• similar products sold within the same price range
• products are identical 

What is an example of a monopoly?

• Taco Bell
• National Hockey League (NHL)
• Lucky Brand Jeans
• Holiday Inn