Which of the following is a true statement about the effect of a government-imposed minimum price floor when the price set is above the normal free market price?
a. If the government imposes a price floor, total consumer surplus will decrease
b. If the government imposes a price floor, all firms in the market will gain
c. If the government imposes a price floor, there will be a shortage
d. If the government imposes a price floor, consumer surplus will increase

What is the definition of consumer surplus?
a. The difference between the consumer's willingness to pay and and the price actually paid for the product.
b. The total value placed on products by the market
c. The difference between the consumer's willingness to pay and the firm's cost of the product.
d. The total value placed on products by consumers

Most of the benefits to agricultural support schemes such as the European Common Agricultural Policy go to
a. Consumers
b. The Government
c. Producers
d. Everyone gains equally from price supports

Evaluate the following quote from tomorrow's Washington Post (Oct. 15) in terms of Schumpeter's creative destruction:

At Evergreen Federal Bank in Grants Pass, Ore., chief executive Brady Adams said he has more than 2,000 loans outstanding and only three borrowers behind on payments. "We don't need a bailout, and if other banks had run their banks like we ran our bank, they wouldn't have needed a bailout, either," Adams said.