Econ 202 Ch 6 Q&A – Flashcards
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A tax burden falls more heavily on the side of the market that
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is more inelastic
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A tax imposed on the buyers of a good will raise the
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price paid by buyers and lower the equilibrium quantity
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A shortage results when a
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binding price ceiling is imposed on a market
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A binding minimum wage tends to
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cause a labor surplus, cause unemployment and have the greatest impact in the market for teenage labor
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A price ceiling is binding when it is set
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below the equilibrium price, causing a shortage
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A tax on buyers will shift the
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demand curve downward by the amount of the tax
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A minimum wage that is set below a market's equilibrium wage will
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have no impact on employment
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A tax on sellers will shift the
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supply curve upward by the amount of the tax
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A surplus results when a
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binding price floor is imposed on a market
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A minimum wage that is set above a market's equilibrium wage will result in an excess
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supply of labor, that is, unemployment
