(a) Elaborate price ceiling and price floor and give an example of each. Which leads to a shortage? Which leads to a surplus? Why?

(b) Suppose the government removes a tax on buyers of a good and levies a tax of the same size on sellers of the good. How does this change in tax policy affect the price that buyers pay sellers for this good, the amount buyers are out of pocket (including any tax payments they make), the amount sellers receive (net of any tax payments they make), and the quantity of the good sold?

c) Explain why an economy's income must equal its expenditure. Which contributes more to GDP-the production of an economy car or the production of a luxury car? Why?