Question :
71.
If the intended aim of the price floor set in : 1379040
71.
If the intended aim of the price floor set in the graph shown was a net increase in the well being of producers, then positive analysis would have us consider:
A. whether the surplus transferred from producers to consumers is larger than the consumer surplus lost to deadweight loss.
B. whether the surplus transferred from consumers to producers is larger than the consumer surplus lost to deadweight loss.
C. whether the producer surplus lost to deadweight loss is greater than the producer surplus gained from a higher price.
D. whether the producer surplus lost due to lower prices is greater than the producer surplus lost due to fewer transactions taking place.
72.
If the intended aim of the price ceiling set in the graph shown was a net increase in the well being of consumers, then positive analysis would consider:
A. the policy to be effective if area B is larger than area F.
B. the policy to be effective if area E + B is larger than C + F.
C. the policy to be ineffective if area B is larger than area F.
D. the policy to be ineffective if area E + B is larger than C + F.
73.
If the intended aim of the price ceiling set in the graph shown was a net increase in the well being of consumers, then normative analysis would conclude that:
A. the policy was effective, since surplus gained by producers through higher prices is greater than the surplus they lost through deadweight loss.
B. the policy was ineffective, since surplus gained by producers through higher prices is greater than the surplus they lost through deadweight loss.
C. the policy was effective, since surplus gained by producers through higher prices is greater than the surplus lost by consumers through higher prices.
D. there is no “right” conclusion to be reached in a normative sense, since people have different opinions concerning what constitutes a better outcome.
74.
Which of the following changes to the market in the graph shown could cause the price floor to become ineffective?
A. Demand could decrease, and shift to the left.
B. Supply could increase, and shift to the left.
C. Supply could increase, and shift to the right.
D. Supply could decrease, and shift to the left.
75.One way to ensure all producers benefit from a price floor is:
A. give a government guarantee to buy all surplus.
B. ration a certain quantity per household.
C. give them to the friends and family of the producers.
D. All of these are examples of ensuring all producers benefit using non-price methods.
76.Because a price floor causes:
A. a shortage, rationing must occur.
B. a surplus, some producers may ultimately lose because they won’t have enough customers.
C. a shortage, a central planner must distribute the goods fairly.
D. a surplus, a central planner must distribute the goods fairly.
77.An unintended consequence of price ceilings is:
A. non-price rationing must occur, and can lead to bribes.
B. the loss of surplus always outweighs the benefits of the policy.
C. the transfer of surplus from producer to consumer rarely is recognized.
D. None of these is correct.
78.An unintended consequence of price floors is:
A. non-price rationing must occur, and can lead to bribes.
B. the cost to taxpayers if the government buys all surplus.
C. the loss of surplus always outweighs the benefits of the policy.
D. the transfer of surplus from consumer to producer is rarely recognized.
79.Taxes:
A. are the main way that governments raise revenue to pay for public programs.
B. are sometimes used to correct market failures.
C. never have unintended consequences.
D. All of these are true.
80.Any tax on a good can:
A. discourage consumption of the good.
B. discourage production of the good.
C. create a new source of public revenue.
D. All of these are true.
