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Macroeconomics

Roger A. Arnold

Chapter 4

Prices: Free, Controlled, and Relative - all with Video Answers

Educators

Chapter Questions

03:48

Problem 1

"If price were outlawed as the rationing device used in markets, there would be no need for another rationing device to take its place. We would have reached utopia." Discuss.

Kaylee Mcclellan
Kaylee Mcclellan
Numerade Educator
01:25

Problem 2

What kind of information does price transmit?

Yang Su
Yang Su
Numerade Educator
02:50

Problem 3

Should grades in an economics class be "rationed" according to dollar price instead of how well a student does on exams? If they were and prospective employers learned of it, what effect might this have on the value of your college degree?

Jennifer Stoner
Jennifer Stoner
Numerade Educator
02:17

Problem 4

Think of ticket scalpers at a rock concert, a baseball game, or an opera. Might they exist because the tickets to these events were originally sold for less than the equilibrium price? Why or why not? In what way is a ticket scalper like and unlike your retail grocer, who buys food from a wholesaler and then sells it to you?

Xiaomin Bian
Xiaomin Bian
Numerade Educator
02:53

Problem 5

Many of the proponents of price ceilings argue that government-mandated maximum prices simply reduce producers' profits and do not affect the quantity supplied of a good on the market. What must the supply curve look like if the price ceiling does not affect the quantity supplied?

Yang Su
Yang Su
Numerade Educator
02:31

Problem 6

James lives in a rent-controlled apartment and has for the past few weeks been trying to get the supervisor to fix his shower. What does waiting to get one's shower fixed have to do with a rent-controlled apartment?

Breanna Ollech
Breanna Ollech
Numerade Educator
01:52

Problem 7

Explain why fewer exchanges are made when a disequilibrium price (below the equilibrium price) exists than when the equilibrium price exists.

Kaylee Mcclellan
Kaylee Mcclellan
Numerade Educator
03:53

Problem 8

Buyers always prefer lower prices to higher prices. Do you agree or disagree with this statement? Explain your answer.

Xiaomin Bian
Xiaomin Bian
Numerade Educator
02:59

Problem 9

What is the difference between a price ceiling and a price floor? What effect is the same for both a price ceiling and a price floor?

Kaylee Mcclellan
Kaylee Mcclellan
Numerade Educator
01:15

Problem 10

If the absolute price of good $X$ is $$\$ 10$$ and the absolute price of good $Y$ is $$\$ 14,$$ then what is $(a)$ the relative price of good $X$ in terms of good $Y$ and $(b)$ the relative price of good $Y$ in terms of good $X ?$

Anand Jangid
Anand Jangid
Numerade Educator
01:00

Problem 11

Give a numerical example that illustrates how a tax placed on the purchase of good $X$ can change the relative price of good $X$ in terms of good $Y$.

Carson Merrill
Carson Merrill
Numerade Educator