In 1970s the federal government imposed price controls on natural gas. Which of the following statements is true?
A) These price controls caused a chronic excess supply of natural gas.
B) Consumers gained from the price controls, because consumer surplus was larger than it would have been under free market equilibrium.
C) Producers gained from the price controls because producer surplus was larger than it would have been under free market equilibrium.
D) This episode of price controls was unusual, because it resulted in no deadweight loss to society.
B
You might also like to view...
A price above equilibrium always yields a surplus.
Answer the following statement true (T) or false (F)
What term is used to describe the lowest point of a business cycle?
A) peak B) trough C) expansion D) recession
According to Solow's exogenous growth theory, what happens to a country at steady state that suffered extensive capital destruction due to a war or climate event?
A) It will stay poor forever. B) It will grow back to be richer than before. C) It will get back to its original status. D) Anything can happen.
If a savings account pays 5 percent annual interest, then the rule of 70 tells us that the account value will double in approximately 14 years
a. True b. False Indicate whether the statement is true or false