In a market for a particular good or service the government imposes a restriction on the...
In a market for a particular good or service the government imposes a restriction on the quantity sold that is below the free market quantity Q. What do you observe in the market?
Homework Answers
Answer - Due to the restriction on the sale of the product below the free market quantity, the demand for the product will start rising and the supply will fall. Hence the price of the commodity will rise because the consumer will be more and the supply will be less. Hence the market price of the commodity will increase.
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In a market for a particular good or service the government
imposes a restriction on the...
When a government imposes a price ceiling below the market price on a product or service,...
When a government imposes a price ceiling below the market price on a product or service, which of the following happens? a.Total consumer surplus rises because consumers now pay less for the product b.The total amount of the product or service that is traded in the market rises due to the lower price c.A shortage of supply relative to demand results A per unit tax on a good which is levied on the consumer will usually cause which of the...
Assume that the market for a good is in equilibrium at a price of $20 and a quantity of 100 units. After the government imposes a $5 per-unit excise tax on the good, the price that buyers pay for the good increases by $3. Which of the following are possib
Assume that the market for a good is in equilibrium at a price of $20 and a quantity of 100 units. After the government imposes a $5 per-unit excise tax on the good, the price that buyers pay for the good increases by $3. Which of the following are possible values for the government tax revenue and deadweight loss in the market
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)...
When a country that imports a particular good imposes a tariff on that good, a. producer...
When a country that imports a particular good imposes a tariff on that good, a. producer surplus increases and total surplus increases in the market for that good. b. producer surplus decreases and total surplus decreases in the market for that good. c. producer surplus decreases and total surplus increases in the market for that good. d. producer surplus increases and total surplus decreases in the market for that good.
Price of good or service 0 0 Quantity of good or service per period Protectionist policies...
Price of good or service 0 0 Quantity of good or service per period Protectionist policies reduce the quantities of foreign goods and services supplied to the country that imposes the restriction. As a result, such policies shift the supply curve to the leta for the good or service whose imports are restricted. In the case shown, the supply curve shifts to Sa, the equilibrium price cises Pa and the equilibrium quantity falls to Oz.
Suppose the government imposes a price floor of $28 in the market. If the sellers with...
Suppose the government imposes a price floor of $28 in the
market. If the sellers with the lowest cost are the ones who sell
the good and the government does not purchase any excess units
produced, then the total surplus will be
a. $400
b. $800
c. $1,120
d. $1,184
+ 16+ **** 12+ 8 8 16 24 32 40 48 56 64 72 80 88 96 Q
If the government imposes a limit on sales of a good or service by licensing the...
If the government imposes a limit on sales of a good or service by licensing the right to sell a given quantity of the good, the difference between the demand and supply price is Select one: A the quota rent B. the equilibrium price. O C. the quota price D. deadweight loss Next page If the opportunity cost of manufacturing machinery is lower in Canada than in Britain and the opportunity cost of manufacturing sweaters is higher in Canada than...
. A black market may occur when A) the government imposes a price ceiling above the...
. A black market may occur when A) the government imposes a price ceiling above the market clearing price. B) the government imposes a price floor below the market clearing price. C) the government imposes a price ceiling below the market clearing price. D) the government does not impose either a price ceiling or a price floor.
Price Graph The graph shows the market for good A. The equilibrium price and quantity is...
Price Graph The graph shows the market for good A. The equilibrium price and quantity is PM and Q, respectively. Suppose the government imposes a price control that reduces producer surplus. Determine the type of price control and show it on the graph. The price control set by the government in this situation is a Using the line drawing tool, draw a price control line and label it "Price Control Carefully follow the instructions above, and only draw the required...
Tax Problem: Suppose the demand curve for a good is given by Q D = 10...
Tax Problem:
Suppose the demand curve for a good is given by Q D = 10 - 2P and
the supply curve is given by
Q S = -2 + P.
a) (4 points) Find the equilibrium price and quantity in the
absence of any government intervention.
b) (6 points) Now suppose the government imposes a tax of t = 3.
Find the new equilibrium price at
which the good is sold in the market and the quantity of the...
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)...
Price of good or service 0 0 Quantity of good or service per period Protectionist policies reduce the quantities of foreign goods and services supplied to the country that imposes the restriction. As a result, such policies shift the supply curve to the leta for the good or service whose imports are restricted. In the case shown, the supply curve shifts to Sa, the equilibrium price cises Pa and the equilibrium quantity falls to Oz.
Suppose the government imposes a price floor of $28 in the
market. If the sellers with the lowest cost are the ones who sell
the good and the government does not purchase any excess units
produced, then the total surplus will be
a. $400
b. $800
c. $1,120
d. $1,184
+ 16+ **** 12+ 8 8 16 24 32 40 48 56 64 72 80 88 96 Q
If the government imposes a limit on sales of a good or service by licensing the right to sell a given quantity of the good, the difference between the demand and supply price is Select one: A the quota rent B. the equilibrium price. O C. the quota price D. deadweight loss Next page If the opportunity cost of manufacturing machinery is lower in Canada than in Britain and the opportunity cost of manufacturing sweaters is higher in Canada than...
. A black market may occur when A) the government imposes a price ceiling above the market clearing price. B) the government imposes a price floor below the market clearing price. C) the government imposes a price ceiling below the market clearing price. D) the government does not impose either a price ceiling or a price floor.
Price Graph The graph shows the market for good A. The equilibrium price and quantity is PM and Q, respectively. Suppose the government imposes a price control that reduces producer surplus. Determine the type of price control and show it on the graph. The price control set by the government in this situation is a Using the line drawing tool, draw a price control line and label it "Price Control Carefully follow the instructions above, and only draw the required...
Tax Problem:
Suppose the demand curve for a good is given by Q D = 10 - 2P and
the supply curve is given by
Q S = -2 + P.
a) (4 points) Find the equilibrium price and quantity in the
absence of any government intervention.
b) (6 points) Now suppose the government imposes a tax of t = 3.
Find the new equilibrium price at
which the good is sold in the market and the quantity of the...
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