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Chapter 11: Market Intervention

Authored by Economics A

Education

10th - 11th Grade

Used 34+ times

Chapter 11: Market Intervention
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21 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

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1. Refer to the following demand and supply schedules for a good.

If the government sets a maximum price control at $12,

(1) the total expenditure will decrease by $800.

(2) there would be a surplus of 30 units.

(3) the quantity transacted will decrease by 20 units.

A. (1) and (2) only

B. (1) and (3) only

C. (2) and (3) only

D. (1), (2) and (3)

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

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2. Refer to the following demand-supply diagram.

If the government lowers the price ceiling from P1 to P2, the total expenditure of consumers

A. will increase.

B. will decrease.

C. will remain unchanged.

D. may increase, decrease or remain unchanged, depending on the price elasticity of demand.

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

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3. As shown in the following diagram, the government of Country A has imposed a price ceiling on good X at P.

If there is a technological improvement in the production of good X, the

A. excess supply will be larger.

B. excess demand will be larger.

C. quantity transacted will increase.

D. total revenue will decrease.

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

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4. The following diagram shows the market situation of good X.

If the government imposes a price floor on the good at P3, the quantity transacted of the good will be __________ .

A. Q1

B. Q2

C. Q3

D. Q4

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

5. Suppose the government raises the effective minimum wage. Which of the following statements are CORRECT?

(1) It will be more difficult for low-skilled workers to get a job.

(2) There will be an excess supply of workers.

(3) Total wage earnings of low-skilled workers will increase.

A. (1) and (2) only

B. (1) and (3) only

C. (2) and (3) only

D. (1), (2) and (3)

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Media Image

6. Refer to the following demand and supply

schedules for a good.

There is a minimum price control of $8. Suppose the government lowers the price control by $3. As a result,

A. the market price would drop by $3.

B. there would be a shortage of 8 units.

C. the total revenue would decrease by $12.

D. the quantity transacted would increase by 3 unit.

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

7. Imposing an effective quota on a good will not lead to an increase in its equilibrium price if the demand for the good is

A. elastic.

B. inelastic.

C. unitarily elastic.

D. perfectly elastic.

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