#1
Which of the following is an example of a price ceiling?
Minimum wage laws
Rent control
Subsidies for farmers
Sales tax
#2
Which of the following is an example of a government subsidy?
Price ceiling on gasoline
Tax on imported goods
Cash payment to farmers for crop production
Minimum wage regulation
#3
What effect does a price ceiling typically have on quantity supplied?
Increases it
Decreases it
No effect
Shifts it to the left
#4
What is the primary goal of implementing a price floor?
To increase consumer surplus
To decrease producer surplus
To create a shortage in the market
To set a minimum price for a good or service
#5
Which of the following is an example of a market intervention to correct externalities?
Imposing a tax on cigarettes to reduce smoking
Subsidizing the production of solar panels
Implementing a minimum wage law
Enforcing antitrust laws
#6
What is the term for the situation where the price mechanism fails to allocate resources efficiently?
Market equilibrium
Market failure
Government intervention
Perfect competition
#7
What is the primary goal of market interventions?
To maximize producer surplus
To ensure equity in distribution
To maximize consumer surplus
To minimize government interference
#8
In economics, what does 'deadweight loss' refer to?
Loss of revenue for firms
Efficiency loss due to market intervention
Decrease in consumer demand
Increase in government revenue
#9
Which of the following is a potential consequence of imposing a price floor?
Excess demand
Surplus supply
Equilibrium price decrease
Decrease in producer surplus
#10
Which of the following is NOT a reason for government intervention in markets?
To correct market failures
To ensure economic efficiency
To promote social equity
To maximize corporate profits
#11
What happens to consumer surplus when a price floor is imposed?
It increases
It decreases
It remains the same
It becomes negative
#12
What is a negative consequence of government price controls?
Increase in market efficiency
Reduction in consumer choices
Enhanced competition among producers
Encouragement of innovation
#13
What concept is illustrated by the intersection of supply and demand curves in a market?
Market equilibrium
Price ceiling
Market intervention
Deadweight loss
#14
Which of the following is a characteristic of a perfectly competitive market?
High barriers to entry
Numerous buyers and sellers
Heavy government regulation
Monopolistic control over price
#15
What is the main effect of government subsidies on producers?
Increases the equilibrium price
Decreases the quantity supplied
Increases producer surplus
Creates a surplus in the market
#16
What is the primary reason for government intervention to address income inequality?
To maximize consumer surplus
To promote economic growth
To ensure social stability
To minimize producer surplus
#17
What is the term used to describe the additional cost incurred by society as a whole when an additional unit of a good or service is produced?
Producer surplus
Marginal cost
External cost
Social cost