1. Read the following statement and decide if it is true or false, then provide a rationale for your answer.An import quota is a superior trade barrier to a tariff.
2. An increase in the price of a product will lead to a decrease in quantity demanded because of the income and substitution effect.Please describe how the budget line can be used to help illustrate the income effect.
3. When Canadians import electronics,[w]win as they are able[t]more of the product at the lower[x].This leads to an increase in[y]surplus but a decrease in[z]surplus.When Canadian export goods,[g]win.
4. In Canada people pay a sales tax on their purchases, it is called the GST.The fact that low income families receive a rebate of $50 when they file their income taxes reflects the principle of[A].The carbon tax on gasoline is an example of the principle of[B].
5. The equilibirum price before any government intervention was $5.00 per unit sold.A tax of 2.71 per unit was placed on the item by the government. The after tax price to the consumer is now 6.44.What percentage of the tax is theproducerpaying? Please answer in a whole number.
6. Rent ($ per month) Quantity Supplied (one bedroom apartments per month)Quantity Demanded (one bedroom apartments per month)

1200 20 100

1300 40 80

1400 60 60

1500 80 40

1600 100 20

• Examine the table above, the government is considering putting on a price ceiling of either $1300 or $1500.
• Match up the answers below, negative scoring is in place.
• A price ceiling of $1300 is __________.
• At a price ceiling of $1500 the quantity supplied is ______.
• At a price ceiling of $1300, there is a ______________ .
• At a price ceiling of $1500 there is ___________.
• A price celing of $1500 is ____________.

1. Please provide an example, not the textbook example of either bounded will power or bounded self interest from your life.
2. Consider a government that is trying to reduce harmful illegal drug use.What is the argument for putting penalties on the consumer as well as the producer?Use economic terms in a short argument.
3. An effective subsidy paid to soybean farmers ________ the market price of soybeans and ________ the farmers' marginal cost of production.