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Question
What will happen in a market where a nonbinding price ceiling is removed?
a. There will be downward pressure on the price in the legal market.
b. The products sold will improve in quality and become more plentiful.
c. Sellers will face a reduced incentive to sell the products.
d. The price and quantity will not change in the legal market.
e. There will be increased pressure to buy and sell the goods on the black market.
Answer
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Related questions
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Price gouging laws will usually result in ________ the product in the distressed market.
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The economic entity most likely to engage in price gouging is
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Q:
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Q:
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.
b. He or she will substitute toward 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.
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Suppose Kate lives in a community with no price controls. What could she expect will happen if her town borders a community where there is a nonbinding price ceiling on most products?
a. Legal market prices will rise in the community with a binding price ceiling.
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Q:
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b. because it greatly benefits government, which receives additional tax revenue as a result
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