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Worksheet Price Controls

The document is an economics worksheet that contains questions about price controls and minimum wages. It asks students to analyze graphs of supply and demand curves to determine the effects of a price ceiling, price floor, and minimum wage. Specifically, it asks whether a price ceiling or price floor would result in a shortage or surplus. It also asks students to identify the effects of a minimum wage by illustrating it on a labor market graph and determining if it would result in a shortage or surplus of jobs.

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Katherine Sauer
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© Attribution Non-Commercial (BY-NC)
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Download as DOCX, PDF, TXT or read online on Scribd
638 views

Worksheet Price Controls

The document is an economics worksheet that contains questions about price controls and minimum wages. It asks students to analyze graphs of supply and demand curves to determine the effects of a price ceiling, price floor, and minimum wage. Specifically, it asks whether a price ceiling or price floor would result in a shortage or surplus. It also asks students to identify the effects of a minimum wage by illustrating it on a labor market graph and determining if it would result in a shortage or surplus of jobs.

Uploaded by

Katherine Sauer
Copyright
© Attribution Non-Commercial (BY-NC)
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Name: ___________________________________________________________________________

Economics Dr. Sauer

Worksheet: Price Controls 1. Refer to the graph.


20 18 16 S 14 12 10 8 6 4 2 quantity D price

a. According to the graph, equilibrium price is ________ and equilibrium quantity is _________. b. If the government imposed a price ceiling of $4 in this market, what will be the effects?

c. If instead the government imposed a price floor of $14 in this market, what will be the effects?

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2. In the labor market, the market price is called the wage and the quantity refers to the quantity of workers. The supply curve is the supply of labor, that is, the number of people who are willing to work at various wages. The demand curve is the demand for labor, that is, the number of jobs that firms are offering. Suppose in order to help out low-skilled workers, the government decides to implement a minimum wage in the labor market. a. On the graph, illustrate a minimum wage. b. At the minimum wage, indicate - the number of people willing to work at that wage - the number of jobs available at that wage - any shortage or surplus

c. Which is greater, the number of people who want to work at the new higher wage or the number of jobs available at the new higher wage?

d. How does the number of people who actually have jobs before the minimum wage differ from the number of people who actually have jobs once the minimum wage is in place?

e. What do you now realize is an effect of the minimum wage?

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