#1
What is the primary aim of implementing price controls in a market?
To ensure fair distribution of goods and services
To maximize profits for producers
To eliminate competition among businesses
To encourage hoarding of goods
#2
Which of the following is an example of a price floor?
Minimum wage laws
Rent control
Subsidies for farmers
Price ceilings on gasoline
#3
Which of the following is an example of a price ceiling?
Rent control
Minimum wage laws
Subsidies for farmers
Tax on cigarettes
#4
What is the economic term for the level at which supply and demand are equal?
Market equilibrium
Price control
Demand elasticity
Market distortion
#5
What is the term for a situation in which the government intervenes to set a maximum price for a particular good or service?
Price floor
Price ceiling
Market equilibrium
Supply shock
#6
What is the primary objective of implementing price controls?
Maximize profits for producers
Ensure fairness in resource distribution
Encourage monopoly in the market
Reduce consumer choices
#7
What happens when a government imposes a price ceiling below the market equilibrium price?
There will be a shortage of the good
There will be a surplus of the good
There will be no effect on the market
Consumers will stop buying the good
#8
Which of the following statements is true about price controls in a market economy?
Price controls always lead to efficient allocation of resources
Price controls can sometimes lead to black markets
Price controls only affect producers, not consumers
Price controls are only implemented in command economies
#9
What is the potential downside of implementing a price ceiling?
Creates inefficiency in resource allocation
Increases consumer surplus
Encourages hoarding of goods
Leads to a surplus of goods
#10
How does a price floor affect producer surplus?
Increases producer surplus
Decreases producer surplus
Has no effect on producer surplus
Converts producer surplus into consumer surplus
#11
What is the term used to describe a situation where a price ceiling leads to the development of illegal markets?
Market equilibrium
Price gouging
Black market
Monopoly
#12
What is the primary effect of a price ceiling below the equilibrium price?
Surplus of goods
Shortage of goods
No effect on the market
Increase in consumer demand
#13
In what scenario might a government implement a price floor?
To prevent prices from falling below a certain level
To encourage competition among producers
To control inflation
To increase consumer surplus
#14
What is the main goal of implementing price controls during times of crisis?
To stabilize prices and prevent exploitation
To maximize profits for producers
To encourage speculative behavior in the market
To reduce government intervention in the economy
#15
What could be a consequence of a government imposing a price floor above the equilibrium price?
Surplus of goods
Shortage of goods
No effect on the market
Decrease in consumer demand
#16
Which of the following is a potential consequence of implementing a price floor in an agricultural market?
Increased agricultural imports
Decreased government subsidies
Excessive production leading to surplus
Decreased consumer demand
#17
In a market with a price ceiling set above the equilibrium price, what is the likely outcome?
Shortage of goods
Surplus of goods
No impact on the market
Decrease in consumer demand
#18
Which of the following is a possible consequence of imposing a price floor above the equilibrium price?
Surplus of goods
Shortage of goods
Increase in consumer demand
Decrease in producer surplus