Question 4.

Assume the labour market is in equilibrium. Now suppose, the government imposes a price floor that is above the original equilibrium price. Explain the economic effects of the price floor?(Be sure to discuss quantity demanded and quantity supplied, you can draw a diagram as part of your answer)

Question 5

Assume the housing market is in equilibrium. Now suppose, the government imposes a price ceiling that is below the original equilibrium price. Explain the economic effects of the price ceiling?(Be sure to discuss quantity demanded and quantity supplied, you can draw a diagram as part of your answer)

Question 6

Suppose that household income in Charlottetown increases from $44,000 to $45,000 and the quantity of Baker Baked Beans rises from 90 to 94 cases per week.

a.What is the income elasticity of demand for beans?

b.What does this suggest about this product?