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Question
Setting a price ceiling below the equilibrium price can result in
a. a surplus, where the quantity demanded exceeds the quantity supplied.
b. a shortage, where the quantity demanded exceeds the quantity supplied.
c. a surplus, where the quantity supplied exceeds the quantity demanded.
d. a shortage, where the quantity supplied exceeds the quantity demanded.
e. no impact on the quantity demanded or on the quantity supplied.
Answer
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Related questions
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The economic entity most likely to engage in price gouging is
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What will an individual do differently as a buyer in the black market in the long run?
a. He or she will substitute away from the product.
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d. When a binding price ceiling exists, he or she will be willing to pay a lower price.
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Q:
What is the long-run consequence of a price ceiling law?
a. A surplus will continue to exist and will grow larger over time.
b. A surplus will continue to exist and will grow smaller over time.
c. A shortage will continue to exist and will grow larger over time.
d. A shortage will continue to exist and will grow smaller over time.
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Q:
Suppose Solomon lives in a community with no price controls. What do you expect will happen if his town borders a community where there is a binding price ceiling on most products?
a. Prices in the legal market in the community with a binding price ceiling will rise.
b. Prices in the legal market in the community with a binding price ceiling will fall.
c. There will be shortages in the community with a binding price ceiling.
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Q:
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