2.In the labor market, what causes a movement along the supply curve? What causes a shift in the supply curve?

3.Why is a living wage considered a price floor? Does imposing a living wage have the same outcome as a minimum wage?

4.In the financial market, what causes a movement along the demand curve? What causes a shift in the demand curve?

5.In the financial market, what causes a movement along the supply curve? What causes a shift in the supply curve?

6.If a usury law limits interest rates to no more than 35%, what would the likely impact be on the amount of loans made and interest rates paid?

7.Which of the following changes in the financial market will lead to a decline in interest rates:

1. a rise in demand
2. a fall in demand
3. a rise in supply
4. a fall in supply

8.Which of the following changes in the financial market will lead to an increase in the quantity of loans made and received:

1. a rise in demand
2. a fall in demand
3. a rise in supply
4. a fall in supply

9.Identify the most accurate statement. A price floor will have the largest effect if it is set:

1. substantially above the equilibrium price
2. slightly above the equilibrium price
3. slightly below the equilibrium price
4. substantially below the equilibrium price

Sketch all four of these possibilities on a demand and supply diagram to illustrate your answer.

10.A price ceiling will have the largest effect:

1. substantially below the equilibrium price
2. slightly below the equilibrium price
3. substantially above the equilibrium price
4. slightly above the equilibrium price

Sketch all four of these possibilities on a demand and supply diagram to illustrate your answer.

11.Select the correct answer. A price floor will usually shift:

1. demand
2. supply
3. both
4. neither

Illustrate your answer with a diagram.

12.Select the correct answer. A price ceiling will usually shift:

1. demand
2. supply
3. both
4. neitherr