Reference: Ref 6-5 (Figure: Imposition of a Tax) Refer to the Figure

question 82

Multiple Choice

Reference: Ref 6-5 (Figure: Imposition of a Tax) Refer to the figure. After the imposition of a $4 tax, the government collects revenues of:

• A) $75.
• B) $100.
• C) $210.
• D) $50.

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Definitions:

Long Lines

Typically a result of excessive demand or insufficient supply, creating a situation where people have to wait for a long time to avail of a service or purchase a product.

Rationing Methods

Techniques used to distribute scarce goods among consumers when demand exceeds supply, such as price increments, waiting lists, or coupons.

Binding Price Ceiling

A government-imposed limit on the price of a good or service that is set below the equilibrium market price, leading to shortages.

Binding Price Ceiling

A price ceiling set below the equilibrium price, leading to a shortage of goods since demand exceeds supply at the set price.