Market Prices and Minimum Wage Quiz

What happens when a market is in equilibrium?

• Supply exceeds demand

• Demand exceeds supply

• Quantity demanded equals quantity supplied

• Prices increase rapidly

What did airlines signal to buyers when they started charging fees for checked bags?

• To check more bags

• To avoid flying

• To check fewer bags

• To buy more tickets

What is a price ceiling?

• A government-mandated minimum price

• A government-mandated maximum price

• The equilibrium price

• The price at which demand equals supply

What is the result of rent control in the housing market?

• Surplus of apartments

• Equilibrium in housing market

• Shortage of apartments

• Increase in housing prices

What is the significance of the equilibrium price in the market?

• It is the price at which all trades are desired

• It is the price set by the government

• It is the price that changes frequently

• It is the price that benefits only sellers

What does the minimum wage act as for low-skilled labor?

• A price ceiling

• A price floor

• An equilibrium price

• A market price

What is the main argument of economists who support a higher minimum wage?

• It significantly reduces low-skilled jobs

• It boosts family income for many workers

• It restricts access to entry-level positions

• It benefits the working poor

What is the earned income tax credit designed to do?

• Provide a subsidy for high-income families

• Encourage low-income working people to reduce their work hours

• Provide a refundable federal tax credit for low-income working people

• Increase the minimum wage

What is the "labor market"?

• The market in which workers compete for jobs and employers compete for workers

• The lowest wage that employers may legally pay for an hour of labor

• The dollar amount the Census Bureau uses to determine a family's or person's poverty status

• A government-mandated minimum price that must be paid for a good or service

What are "unintended consequences"?

• The unexpected and unplanned results of a decision or action

• The lowest wage that employers may legally pay for an hour of labor

• The dollar amount the Census Bureau uses to determine a family's or person's poverty status

• A government-mandated minimum price that must be paid for a good or service