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8 Cards in this Set
- Front
- Back
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Price controls or quantity controls create..
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Undesirable side effects such as inefficiency and crime.
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Price ceilings are _______ the equilibrium price.
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Below
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Price ceilings lead to..
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1. Inefficient allocation to consumers
2. Wasted resources 3. Low quality 4. Illegal activity |
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Price floors are _______ the equilibrium price.
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Above
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Price floors lead to..
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1. Inefficient allocation of sales among sellers
2. Wasted resources 3. Inefficiently high quality |
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Quantity controls, or quotas limit..
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the quantity of a good that can be bought or sold.
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Excise Tax
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Taxes on the purchase or sale of a good
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Excise taxes cause inefficiency called..
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excess burden or deadweight loss
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