Price ceilings are adopted in most cases because
A. the government favors a non-intervention policy.
B. producers need incentives to produce more of the good or service.
C. the government wants to create surpluses.
D. the government views the current equilibrium price as too high for consumers.
Answer: D
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As real rates of interest increase in the economy, real investment spending increases
Indicate whether the statement is true or false
When a nation is producing on its production possibilities frontier, if more resources are used to produce one good, then the production of other goods
A) must increase. B) must decrease. C) must remain the same. D) must change but they might increase or decrease. E) might increase if the nation can produce more efficiently.
What would be expected to happen to the size of the underground economy if:
a. businesses tax rates decreased. b. government regulations on businesses increased dramatically. c. the sale and use of marijuana was legalized in all 50 states.
Your younger sister needs $50 to buy a new bike. She has opened a lemonade stand to make the money she needs. Your mother is paying for all of the ingredients. She currently is charging 25 cents per cup, but she wants to adjust her price to earn the $50 faster. If you know that the demand for lemonade is elastic, what is your advice to her?
a. Leave the price at 25 cents and be patient. b. Raise the price to increase total revenue. c. Lower the price to increase total revenue. d. There isn't enough information given to answer this question.