1. Which statement is TRUE about markets?

a. They only contain legal activity conducted by incorporated businesses.

b.They can contain legal or illegal activity conducted by incorporated businesses.

c. They can contain legal or illegal activity conducted by any individual or business.

2. Which event would shift the supply curve for corn to the right?

a. a decrease in land taxes

b. a decrease in the market price of corn

c. an increase in the market price of corn

3. Suppose in the market for iPhones, the following two changes take place: (1) the cost of making iPhones falls, and (2) the price of smart-phone data plans fall. What happens to the equilibrium price and the equilibrium quantity?

a. The equilibrium price is indeterminate, but the equilibrium quantity rises.

b. The equilibrium price rises, but the equilibrium quantity is indeterminate.

c. The equilibrium price falls, but the equilibrium quantity is indeterminate.