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| A legal maximum on the price at which a good can be sold. Only effective if below market price. |
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a legal minimum on the price at which a good can be sold.
Only effective if above market price. |
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| When the government imposes a binding price ceiling on a competitive market... |
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Definition
| a shortage of a good arises, and sellers must ration the scarce goods among the large number of potential buyers. |
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| A binding price floor causes a... |
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| Minimum wage creates a labor surplus leading to.. |
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| Prices coordinate economic activity. So set prices... |
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Definition
| mess up normal economic activity. |
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| Instead of laws to help the poor, the government can |
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Definition
| The manner in which the burden of a tax is shared among participants in a market |
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| Taxes on sellers: Buyers pay _____ and sellers receive ____. |
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| Overall, tax incidence falls on... |
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| Tax incidence falls more heavily on the side of the market that is.... |
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