If a price ceiling is imposed, then:

If a price ceiling is imposed, then:
 a. the market supply curve will shift to the right.
  b. the market demand will shift to the left.
  c. a shortage of product will result.
  d. the government would be required to buy-up the surplus product.
  e. the market equilibrium price is below the level the government wishes to achieve.

QUESTION 2

If the government imposes a price ceiling, then:
 a. producers must charge the ceiling price.
  b. the price offered by producers must be at or above the ceiling price.
  c. the price offered by producers must be at or below the ceiling price.
  d. producers would be inclined to increase the quantity supplied.
  e. the market supply curve will shift to the right.

QUESTION 3

A price ceiling:
 a. is the lowest price that the law will allow to be charged in the market.
  b. is the highest price that the law will allow to be charged in the market.
  c. is the price that must be charged in the market.
  d. would be imposed if the government believes the market equilibrium price is too low.
  e. would only be applicable in the case of non-essential goods.

QUESTION 4

Rent controls create distortions in the housing market by:
 a. increasing rents received by landlords
  b. raising property values.
  c. encouraging landlords to overspend for maintenance.
  d. discouraging new housing construction.
  e. increasing the supply of housing in the long run.

QUESTION 5

If the equilibrium price of bread is 2 and the government imposes a 1.50 price ceiling on the price of bread, then:
 a. more bread will be produced.
  b. there will be a shortage of bread.
  c. the demand for bread will decrease.
  d. producers will charge 0.50 for bread.
  e. 0.50 in tax revenue will be paid for each unit of bread.

QUESTION 6

When the government imposes a price ceiling on a good whose price is too high,
 a. surpluses are created.
  b. supply will increase to meet the demand.
  c. rationing is not necessary.
  d. quantity demanded of the good will fall.
  e. chronic excess demand occurs.

QUESTION 7

If the equilibrium price of good X is 5 and a price ceiling is imposed at 4, the result will be a(n):
 a. accumulation of inventories of unsold gas. b. shortage.
  c. surplus. d. all of these.