1. Show on a single diagram, given a competitive market, how an increase in demand will provide the opportunity for rent-seeking activity.

1.What is a market and what is the key to functioning markets?  Explain.2.  How do competitive markets guide the allocation of resources?3.  Give an example of a good or service that should not be allocated entirely by a free, unregulated market.  Explain your reasoning. 4. Identify a price control that is, has been, or could be enacted in the real world.  Then, explain the potential benefits and drawbacks of that control. A goal of this prompt is to see both sides of an argument, so please come up with at least one argument for and against said price control.

6. Raleigh and Austin are a young couple, and the only people in their family. Raleigh's monthly demand for pints of ice cream is given by QD=20 - P and Austin's monthly demand for pints of ice cream is given by QD=10-2 P. a. Graph their family demand curve for ice cream. b. Calculate how many pints of ice cream their family buys when P = 10 and when P=4. I

4. The X-Corporation produces a good (called X) that is a normal good. Its competitor, Y-Corp., makes a substitute good that it markets under the name “Y. ”Good Y is an inferior good. Is good Y a lower-quality product than good X ? * a. Yes b. No 5. Good X is produced in a competitive market using input A. Explain what would happen to the supply of good X if the price of input A increases. * a. Increase b. Decrease c. None of the above 6. Good X is produced in a competitive market using input A. Explain what would happen to the supply of good X if an excise tax of P 1 is imposed on good X . * a. Increase b. Decrease c. None of the above