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26 Cards in this Set
- Front
- Back
What happens when wages are set above the equilibrium level by law?
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Firms employ fewer workers
than they would at the equilibrium wage. |
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On which kinds of goods do governments generally place price ceilings?
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those that are essential but too expensive for some consumers
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When buyers will purchase exactly as much as sellers are willing to sell, what is the condition that has been reached?
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equilibrium
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Which of the following is an example of a good whose price goes down because of improvements in technology?
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computer printers
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What happens when the supply of a nonperishable good is greater than the consumer wants to buy?
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the good becomes a luxury and the price rises
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Why did communist governments use a command economic system for many years?
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in an attempt to create a society in which everyone was equal
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Why did the U.S. government use rationing for some foods and consumer goods during World War II?
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to guarantee each civilian a minimum standard of living in wartime
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Which of the following is a situation that makes the market behave inefficiently?
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when consumers do not have enough information to make good choices
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What happens to a market in equilibrium when there is an increase in supply?
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quantity supplied will exceed quantity demanded, so the price will drop
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What is it called when the government uses some tool other than money to allocate goods?
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rationing
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What is the name of the smallest amount that can legally be paid to most workers for an hour of work?
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minimum wage
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The price ceiling that was used to control the price of housing in New York City and other cities was called?
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rent control
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the smallest amount, by law, that can be paid to a worker for an hour of labor
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minimum wage
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a maximum amount that can be legally charged for a good or service
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price ceiling
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a sudden lack of goods
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supply shock
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when quantity supplied is more than quantity demanded
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excess supply
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situation in which quantity demanded is greater than quantity supplied
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shortage
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a price ceiling placed on the amount people pay for housing
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rent control
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the financial and opportunity costs consumers pay when looking for a good or service
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search costs
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when quantity supplied and quantity demanded are not the same in a market
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disequilibrium
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costs of production that affect people who have no control over how much of a good is produced
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spillover costs
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when quantity demanded is more than quantity supplied
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excess demand
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situation in which quantity supplied is greater than quantity demanded
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surplus
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a minimum price for a good or service
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price floor
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a system of allocating scarce goods and services using some criteria other than price
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rationing
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the point at which quantity supplied and quantity demanded are the same
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equilibrium
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