1. Explain the differences between a shortage and scarcity. Give an original example of each. 2. Do you agree/disagree with the following statement: If the government increases the excise tax on bikes, the prices of bikes will rise. However, this will then cause the demand to decrease and as a result prices will fall back to their original levels. (An excise tax is a tax on a specific good, for example there is an excise tax on gas and liquor.)