Suppose that the average cost of a doctor visit is $100. If the government imposes a...
| Suppose that the average cost of a doctor visit is $100. If the government imposes a price ceiling of $50 on the cost of a doctor visit, there will be: | |||||||||
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Homework Answers
The price ceiling in the market is below the equilibrium price so the demand will increase and the supply will decrease. the answer is "B" an excess demand for doctor visit.
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Suppose that the average cost of a doctor visit is $100. If the
government imposes a...
11) Refer to the figure below, which shows the market for vitamins. Suppose the government imposes...
11) Refer to the figure below, which shows the market for vitamins. Suppose the government imposes a price ceiling of Py. How will the price ceiling affect the quantity supplied, quantity demanded and quantity exchanged? Price Supply Price ceiling Demand Quantity of vitamins 12) Refer to the figure below, which shows the market for watermelons. Suppose the government imposes a price floor of Pw. How will the price floor affect the quantity supplied, quantity demanded and quantity exchanged? Price (dollars)...
Suppose the equilibrium price of potatoes is $5 per pound, but the government imposes a price...
Suppose the equilibrium price of potatoes is $5 per pound, but the government imposes a price ceiling of $2 per pound, creating a deadweight loss. True or False: If the government imposes a sales tax of $1 per pound of potatoes (while continuing to maintain the price ceiling), then the deadweight loss will get even larger.
Consider a market in which the government imposes a price ceiling. Assume that neither supply nor...
Consider a market in which the government imposes a price ceiling. Assume that neither supply nor demand is perfectly elastic nor perfectly inelastic. Which of the following groups will always gain from a price ceiling? Consumer Producers The government Society as a whole, because total surplus will increase No group will always gain from a price ceiling
Suppose that the government imposes a $10 tax on sellers of Humbugs. The pre-tax price of...
Suppose that the government imposes a $10 tax on sellers of Humbugs. The pre-tax price of Humbugs was $50. If, at the original equilibrium price, the elasticity of demand was 2 and the elasticity of supply was 15, which of the following is true? The equilibrium quantity of Humbugs will not change. The full amount of the tax will be paid by buyers. Sellers will pay relatively more of the tax than buyers. Buyers will pay relatively more of the...
The following graph shows the market for doctor's office visits. In this market, the central government...
The following graph shows the market for doctor's office visits. In this market, the central government provides health insurance to all consumers. The government insurance plan stipulates a copayment of $40 per doctor's office visit. That is, consumers pay $40 for each doctor's appointment, and the government pays the remainder. Market for Doctor's Office Visits Demand Supply Area Calculator AGE PRICE Dollars per visit) QUANTITY OF VISITS (Million per month per doctor's office visit, and the equilibrium quantity would be...
Suppose that a rise in average income increases the demand for preventative dental visits. a. The...
Suppose that a rise in average income increases the demand for
preventative dental visits.
a. The increase in income leads to an increase
in (quantity supplied OR supply). This is because, as demand
increases, (the supply curve shifts to the right to accommodate the
increase in demand OR the equilibrium quantity moves up the supply
curve to a higher price and more quantity supplied).
b. Shift the appropriate curve or curves below
to show the effect of this change.
Market...
Suppose that the demand curve for sorghum is Q = 120 - 6p and the supply curve is Q=15p. The government imposes a price ceiling of P_{c} = 3 a. What effect does this have on the equilibrium quantity, consumer surplus, producer surplus. and deadweight los
Suppose that the demand curve for sorghum is Q = 120 - 69and the supply curve is Q=15p. The government imposes a price ceiling of P_{c} = 3a. What effect does this have on the equilibrium quantity, consumer surplus, producer surplus. and deadweight loss?b. Who wins and who loss
21. Suppose the government imposes a S9 per unit tax on the production of Good Z....
21. Suppose the government imposes a S9 per unit tax on the production of Good Z. If the demand curve for Good Z is perfectly inelastic and the supply curve is upward-sloping, the price that consumers pay for the good will: A) increase by S9. B) increase by S4.50. C) increase by more than S9.
Refer to the graph below for questions 7-9: Price Supply 15 12 Demand 40 50 80...
Refer to the graph below for questions 7-9: Price Supply 15 12 Demand 40 50 80 104 130 Quantity Suppose the market in the graph is originally in equilibrium at a price of $15. If the government implements a price ceiling at $20, what will be the market outcome? 7. a. Surplus of 90 units b. Surplus of 54 units c. Shortage of 90 units d. Shortage of 54 units e. Market will remain in equilibrium with a quantity of...
Complete the following paragraph by pulling down the correct word or phrase. When the government imposes...
Complete the following paragraph by pulling down the correct word or phrase. When the government imposes a binding price ceiling on loaves of bread, producers will want to supply (a) bread. Therefore, a binding price ceiling bread and consumers will demand (b) of bread. will lead to a (c) The price ceiling will have other effects as well. The size of a loaf of bread and the quality of bread would (d) Although the consumers lucky enough to buy bread...
11) Refer to the figure below, which shows the market for vitamins. Suppose the government imposes a price ceiling of Py. How will the price ceiling affect the quantity supplied, quantity demanded and quantity exchanged? Price Supply Price ceiling Demand Quantity of vitamins 12) Refer to the figure below, which shows the market for watermelons. Suppose the government imposes a price floor of Pw. How will the price floor affect the quantity supplied, quantity demanded and quantity exchanged? Price (dollars)...
Suppose that the government imposes a $10 tax on sellers of Humbugs. The pre-tax price of Humbugs was $50. If, at the original equilibrium price, the elasticity of demand was 2 and the elasticity of supply was 15, which of the following is true? The equilibrium quantity of Humbugs will not change. The full amount of the tax will be paid by buyers. Sellers will pay relatively more of the tax than buyers. Buyers will pay relatively more of the...
The following graph shows the market for doctor's office visits. In this market, the central government provides health insurance to all consumers. The government insurance plan stipulates a copayment of $40 per doctor's office visit. That is, consumers pay $40 for each doctor's appointment, and the government pays the remainder. Market for Doctor's Office Visits Demand Supply Area Calculator AGE PRICE Dollars per visit) QUANTITY OF VISITS (Million per month per doctor's office visit, and the equilibrium quantity would be...
Suppose that a rise in average income increases the demand for
preventative dental visits.
a. The increase in income leads to an increase
in (quantity supplied OR supply). This is because, as demand
increases, (the supply curve shifts to the right to accommodate the
increase in demand OR the equilibrium quantity moves up the supply
curve to a higher price and more quantity supplied).
b. Shift the appropriate curve or curves below
to show the effect of this change.
Market...
21. Suppose the government imposes a S9 per unit tax on the production of Good Z. If the demand curve for Good Z is perfectly inelastic and the supply curve is upward-sloping, the price that consumers pay for the good will: A) increase by S9. B) increase by S4.50. C) increase by more than S9.
Refer to the graph below for questions 7-9: Price Supply 15 12 Demand 40 50 80 104 130 Quantity Suppose the market in the graph is originally in equilibrium at a price of $15. If the government implements a price ceiling at $20, what will be the market outcome? 7. a. Surplus of 90 units b. Surplus of 54 units c. Shortage of 90 units d. Shortage of 54 units e. Market will remain in equilibrium with a quantity of...
Complete the following paragraph by pulling down the correct word or phrase. When the government imposes a binding price ceiling on loaves of bread, producers will want to supply (a) bread. Therefore, a binding price ceiling bread and consumers will demand (b) of bread. will lead to a (c) The price ceiling will have other effects as well. The size of a loaf of bread and the quality of bread would (d) Although the consumers lucky enough to buy bread...
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