5.Let's think about the market for air travel. From August 2014 to January 2015, the price of jet fuel increased roughly 47%. Using the four-step analysis, how do you think this fuel price increase affected the equilibrium price and quantity of air travel?

6.A tariff is a tax on imported goods. Suppose the U.S. government cuts the tariff on imported flat screen televisions. Using the four-step analysis, how do you think the tariff reduction will affect the equilibrium price and quantity of flat screen TVs?

7.What is the effect of a price ceiling on the quantity demanded of the product? What is the effect of a price ceiling on the quantity supplied? Why exactly does a price ceiling cause a shortage?

8.Does a price ceiling change the equilibrium price?

9.What would be the impact of imposing a price floor below the equilibrium price?

10.Does a price ceiling increase or decrease the number of transactions in a market? Why? What about a price floor?

11.If a price floor benefits producers, why does a price floor reduce social surplus?

12.What determines the level of prices in a market?

13.What does a downward-sloping demand curve mean about how buyers in a market will react to a higher price?

14.Will demand curves have the same exact shape in all markets? If not, how will they differ?

15.Will supply curves have the same shape in all markets? If not, how will they differ?

16.What is the relationship between quantity demanded and quantity supplied at equilibrium? What is the relationship when there is a shortage? What is the relationship when there is a surplus?e