The effect of a quantity restriction is generallyhigher taxes to fund government programs to buy the excess.a higher price.an increase in quantity supplied.a decrease in demand.2. Black markets generally develop when there areprice quotas.price subsidies.price ceilings.price floors.3. In a market-based economy, the role of a price system isto address scarcity.to create surpluses.to make goods and services costly for most.to create shortages.4. When prices are regulated by the government, in the way they are with price ceilings and price floors,this results in greater efficiency in the market.this interferes with the rationing function of prices in a free market system.this does not result in any change in the equilibrium set by the market.this assists with the efficient allocation of resources in the market.5. Opponents of the Fight for $15 movement that seeks to increase the minimum wage argue that minimum wages set above the market equilibriumresult in upper-level management lay-offs.increase the demand for skilled labor.decrease the quantity of labor supplied, resulting in labor shortages.increase unemployment, particularly among unskilled workers.6. If the price for grain set by the market is $3.50 a bushel, but the government sets a price of $5 a bushel,a shortage of grain will result.farmers will hold off on planting the new crop until the market arrives at a $5 price.the government will have to purchase the surplus in order to maintain the higher pricedemand will increase until a new market equilibrium of $5 is reached.7. When demand increases while supply remains constant,the market price rises and the equilibrium quantity falls.the market price falls and the equilibrium quantity rises.the market price falls and the equilibrium quantity falls.the market price rises and the equilibrium quantity rises.8. Which of the following goods provided by the government is a true public? good?flood controltax collectionthe United States Postal Servicebridges where tolls are collected9. The study of collective decision?-making, or the process through which? voters, politicians and other interested parties influence non-market choices is known asprivate choice theory.the exclusion principle.antitrust legislation.public choice theory.10. A cost or benefit that flows from an activity that has an impact on an? individual’s well-being, even though that individual was not directly involved in the? activity, is known as?a capital loss.a public good.an externality.a free-rider.11. The following are all economic functions of government EXCEPTpromoting competition.ensuring economy-wide stability.providing public goods.deciding which states may or may not impose income taxes.12. nts made by the government to individuals for which no goods or services are rendered are known asdemerit payments.black market payments.merit payments.transfer payments.13. What is the structure of the U.S. federal income tax? system?It is a system that only considers the average tax rate for an individual taxpayer.It is a regressive tax system since taxpayers with higher incomes pay a higher tax.It is a progressive tax system which uses a marginal tax rate.It a proportional tax system because all people with the same income pay the same tax.14. In the U.S., the corporate income taxdoes not apply to profits earned on exports.only taxes retained earnings.results in taxpayers being doubly taxed on corporate earnings.excludes dividends paid out to shareholders.15. If a government were to adopt an income tax system which taxed all income at 30?%, with the first ?$30,000 of income being tax-exempt, such a system would be ?regressive.proportional.progressive.confiscatory.

The effect of a quantity restriction is generallyhigher taxes to fund government programs to buy the excess.a higher price.an increase in quantity supplied.a decrease in demand.2. Black markets generally develop when there areprice quotas.price subsidies.price ceilings.price floors.3. In a market-based economy, the role of a price system isto address scarcity.to create surpluses.to make goods and services costly for most.to create shortages.4. When prices are regulated by the government, in the way they are with price ceilings and price floors,this results in greater efficiency in the market.this interferes with the rationing function of prices in a free market system.this does not result in any change in the equilibrium set by the market.this assists with the efficient allocation of resources in the market.5. Opponents of the Fight for $15 movement that seeks to increase the minimum wage argue that minimum wages set above the market equilibriumresult in upper-level management lay-offs.increase the demand for skilled labor.decrease the quantity of labor supplied, resulting in labor shortages.increase unemployment, particularly among unskilled workers.6. If the price for grain set by the market is $3.50 a bushel, but the government sets a price of $5 a bushel,a shortage of grain will result.farmers will hold off on planting the new crop until the market arrives at a $5 price.the government will have to purchase the surplus in order to maintain the higher pricedemand will increase until a new market equilibrium of $5 is reached.7. When demand increases while supply remains constant,the market price rises and the equilibrium quantity falls.the market price falls and the equilibrium quantity rises.the market price falls and the equilibrium quantity falls.the market price rises and the equilibrium quantity rises.8. Which of the following goods provided by the government is a true public? good?flood controltax collectionthe United States Postal Servicebridges where tolls are collected9. The study of collective decision?-making, or the process through which? voters, politicians and other interested parties influence non-market choices is known asprivate choice theory.the exclusion principle.antitrust legislation.public choice theory.10. A cost or benefit that flows from an activity that has an impact on an? individual’s well-being, even though that individual was not directly involved in the? activity, is known as?a capital loss.a public good.an externality.a free-rider.11. The following are all economic functions of government EXCEPTpromoting competition.ensuring economy-wide stability.providing public goods.deciding which states may or may not impose income taxes.12. nts made by the government to individuals for which no goods or services are rendered are known asdemerit payments.black market payments.merit payments.transfer payments.13. What is the structure of the U.S. federal income tax? system?It is a system that only considers the average tax rate for an individual taxpayer.It is a regressive tax system since taxpayers with higher incomes pay a higher tax.It is a progressive tax system which uses a marginal tax rate.It a proportional tax system because all people with the same income pay the same tax.14. In the U.S., the corporate income taxdoes not apply to profits earned on exports.only taxes retained earnings.results in taxpayers being doubly taxed on corporate earnings.excludes dividends paid out to shareholders.15. If a government were to adopt an income tax system which taxed all income at 30?%, with the first ?$30,000 of income being tax-exempt, such a system would be ?regressive.proportional.progressive.confiscatory.