Supply and Demand: Quantity Controls

Question 1

If the demand price for a hat is $6 each, and the supply price is $3, what will the wedge be?

Accepted Answer

$3

Question 2

The quota only has effect when it is on the ... of the equilibrium quantity.

Accepted Answer

left

Question 3

The price at which the customers will demand the given quantity.

Accepted Answer

Demand price

Question 4

What is the difference between the supply and demand price called?

Accepted Answer

Wedge

Question 5

If the given quantity increases, the demand price will ... and the supply price will ...

Accepted Answer

Decrease, Increase

Question 6

The price at which the producers will supply the given quantity.

Accepted Answer

Supply price

Question 7

The bigger the deadweight loss is, the ... effective the quota is.

Accepted Answer

more

Question 8

If the quota is on the right of the equilibrium quantity, then it has

Accepted Answer

No effect

Question 9

The lost gains associated with transactions that do not occur due to market intervention.

Accepted Answer

Deadweight loss

Question 10

As a form of quantity controls, only people with ... can legally supply the good or service.

Accepted Answer

Licenses

Question 11

The earnings that accrue to the license-holder from ownership of the right to sell the good.

Accepted Answer

Quota rent

Question 12

Which line will a quota be shown on a graph?

Accepted Answer

Vertical line

Question 13

Restrictions on the quantity of a good that can be bought or sold.

Accepted Answer

Quantity control, Quota

Questions 13