371 Chapter 6 Supply, Demand, and Government PoliciesTRUE/FALSE1. Economic policies often have effects that their architects did not intend or anticipate.ANS: T DIF: 1 REF: 6-0 NAT: Analytic LOC: The study of economics and definitions of economics TOP: Public policy MSC: Definitional2. Rent-control laws dictate a minimum rent that landlords may charge tenants.ANS: F DIF: 1 REF: 6-0 NAT: Analytic LOC: Supply and demand TOP: Rent control MSC: Definitional3. Minimum-wage laws dictate the lowest wage that firms may pay workers.ANS: T DIF: 1 REF: 6-0 NAT: Analytic LOC: Labor markets TOP: Minimum wage MSC: Definitional4. Price controls are usually enacted when policymakers believe that the market price of a good or service is unfair to buyers or sellers.ANS: T DIF: 1 REF: 6-0 NAT: Analytic LOC: Supply and demand TOP: Price controls MSC: Definitional5. Price controls can generate inequities.ANS: T DIF: 1 REF: 6-0 NAT: Analytic LOC: Supply and demand TOP: Price controls MSC: Definitional6. Policymakers use taxes to raise revenue for public purposes and to influence market outcomes.ANS: T DIF: 1 REF: 6-0 NAT: Analytic LOC: Supply and demand TOP: Taxes MSC: Definitional7. If a good or service is sold in a competitive market free of government regulation, then the price of the good or service adjusts to balance supply and demand.ANS: T DIF: 1 REF: 6-1 NAT: Analytic LOC: Supply and demand TOP: Prices MSC: Definitional8. At the equilibrium price, the quantity that buyers want to buy exactly equals the quantity that sellers want to sell.ANS: T DIF: 1 REF: 6-1 NAT: Analytic LOC: Supply and demand TOP: Prices MSC: Definitional9. A price ceiling is a legal minimum on the price at which a good or service ca...
