Price controls are government-imposed limits on the prices that can be charged for goods and services. How can they affect markets?
Price Controls, Subsidies, and the Risks of Good Intentions: Cra

Quiz
•
Business
•
9th Grade
•
Hard
Dorian Byrd
FREE Resource
20 questions
Show all answers
1.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
They can create shortages or surpluses by disrupting the natural balance of supply and demand.
They always ensure fair prices for all consumers.
They eliminate competition in the market.
They have no impact on market equilibrium.
2.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Describe the historical context in which President Nixon implemented price controls in the early 1970s. What were the public's and economists' reactions?
President Nixon implemented price controls in the early 1970s in response to rising inflation, and while the public initially supported the measures, many economists criticized them as ineffective.
President Nixon implemented price controls to address unemployment, and both the public and economists supported the measures.
President Nixon implemented price controls to encourage exports, and the public was largely indifferent while economists praised the policy.
President Nixon implemented price controls to reduce government spending, and both the public and economists opposed the measures.
3.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
A price ceiling is a government-imposed limit on how high a price can be charged for a product. Which of the following is an example of a price ceiling discussed in the video?
Rent control in housing markets
Minimum wage laws
Subsidies for farmers
Tax on luxury goods
4.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
How do price floors work, and what are the implications for producers and consumers as explained in the video?
Price floors set a minimum price above equilibrium, benefiting producers but potentially harming consumers by causing surpluses.
Price floors set a maximum price below equilibrium, benefiting consumers but harming producers by causing shortages.
Price floors eliminate all government intervention in markets, leading to balanced outcomes for both producers and consumers.
Price floors have no effect on market prices or outcomes for producers and consumers.
5.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is deadweight loss, and how does it relate to price ceilings and floors?
Deadweight loss is the loss of economic efficiency when the equilibrium outcome is not achievable, often caused by price ceilings and floors.
Deadweight loss is the profit made by firms when prices are regulated by the government.
Deadweight loss is the increase in consumer surplus due to price controls.
Deadweight loss is the total revenue collected by the government from taxes.
6.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Discuss the impact of rent control as a type of price ceiling on the housing market.
Rent control can lead to housing shortages and reduced quality of rental units.
Rent control increases the supply of rental housing.
Rent control has no effect on the housing market.
Rent control always benefits both landlords and tenants equally.
7.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Agricultural subsidies are government financial supports to farmers. What is one argument economists make against them?
They increase food prices for consumers.
They distort market prices and lead to overproduction.
They reduce government spending.
They encourage sustainable farming practices.
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