1. You see that the price of laptop computers is falling at the same time that the quantity of laptop computers is rising. Would you attribute this to a change in supply or a change in demand for computers? Explain.

2. Outline the stages of the business cycle.

3. Use a graph of the supply of loanable funds and demand for loanable funds to explain what will happen if the Federal Reserve increases the money supply. What would you expect to happen to the interest rate when this occurs?