If a legal price ceiling for gasoline is set above the equilibrium price: Multiple Choice a surplus of the gasoline will occur. a black market will evolve. legal price ceiling doesn't exist. a shortage of the gasoline will occur. neither the equilibrium price nor equilibrium quantity will be affected.
If a legal price ceiling for gasoline is set above the equilibrium price: Multiple Choice a surplus of the gasoline will occur. a black market will evolve. legal price ceiling doesn't exist. a shortage of the gasoline will occur. neither the equilibrium price nor equilibrium quantity will be affected.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Step 1: Define price ceilling
Price ceilings are measures taken by the government to limit the price of a good or service.
This measure is aimed at protecting consumers from high prices which can cause unaffordability of products and increase welfare of consumers.
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