Questions:
1.
What is unique
about an equilibrium price?
2.
What situation can
lead to excess demand?
3.
What situation can
lead to excess supply?
4.
How is a price
floor different from a price ceiling? Give examples of each.
5.
How does rent
control work?
6.
What are the
benefits and drawbacks of a price ceiling?
7.
According to
figure 6.2 on page 127, why are sales lower at $1.00 a slice than at $2.00 a
slice?
8.
What are the
benefits and drawbacks of a price floor?
9.
Turn to the graph
of median weekly earnings on page 536 in the Databank. Suppose that the federal government has
raised the minimum wage to $600 per week.
(a) Which category of jobs would be least affected by the change? (b)
Which two categories would be most affected by the new minimum wage? (c) What
are the likely consequences for workers in these two fields?
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