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Question
If a good is subject to a binding price ceiling and you purchase it on the black market, what do you expect to happen to the price over time?
a. The black market price will rise over time as the supply curve becomes more elastic and the demand curve becomes more inelastic.
b. The black market price will fall over time as both the supply and demand curves become more inelastic.
c. The black market price will rise over time as the demand curve becomes more elastic and the supply curve becomes more inelastic.
d. The black market price will fall over time as both the supply and demand curves become more elastic.
e. The black market price will not change over time.
Answer
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