Scarcity means we are unable to have as much as we would like to have

Suppose the equilibrium price of a gallon of milk is $4. If the government imposes a price floor of $5 per gallon of milk,

A) the quantity supplied of milk exceeds the quantity demanded. B) the quantity supplied of milk falls short of the quantity demanded. C) the supply increases. D) the market will not be affected. E) there will be a shortage of milk.

If the marginal propensity to save is 0.25, then a $10,000 decrease in disposable income will

A) increase consumption by $7,500. B) decrease consumption by $2,500. C) increase consumption by $2,500. D) decrease consumption by $7,500.