If the equilibrium price of good X is 4 and a price ceiling is imposed at 5, the result will be a(n):
a. depletion of inventories. b. shortage.
c. surplus. d. equilibrium.
QUESTION 2Suppose the government imposes rent control (a price ceiling) below the equilibrium price for rental housing. Which of the following could result?
a. Tenants risk breaking rent control law.
b. The quality of existing rental housing deteriorates.
c. Shortages.
d. All of these.
QUESTION 3Suppose a price ceiling is set by the government below the market equilibrium price. Which of the following will result?
a. The demand curve will shift to the left.
b. The quantity demanded will exceed the quantity supplied.
c. The quantity supplied will exceed the quantity demanded.
d. There will be a surplus.
QUESTION 4Which of the following is not a common effect of imposing a rent control?
a. Discriminatory practices by landlords.
b. More time on waiting lists and searching for housing.
c. A black market for rentals.
d. An excess supply of rentals at the controlled price.
QUESTION 5Price ceilings set below the equilibrium create:
a. externalities. b. unemployment.
c. shortages. d. surpluses.
QUESTION 6If the government imposes a price ceiling below the market equilibrium price, which of the following will result?
a. There will be a surplus of the good.
b. The quantity demanded will exceed the quantity supplied.
c. The quantity supplied will exceed the quantity demanded.
d. The demand curve will shift to the left.
QUESTION 7There was an extensive black market (illegal market) for many consumer products in the United States during World War II. A likely explanation of the black market is that:
a. the prices of goods were artificially held down by price controls.
b. black markets were legal during the war.
c. goods were not subject to price controls.
d. gasoline rationing greatly restricted civilians from driving to stores.
QUESTION 8If the equilibrium price of aspirins is 2.50 and a price ceiling is imposed at 3.00, the eventual result after market adjustment will be a(n):
a. surplus. b. shortage.
c. accumulation of inventories. d. equilibrium.
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