New tab x Augusta Bar X UMA-UMA X BM04: Applicat X Price Ceilings X Syllabus-MU x + content/349328/Home?itemIdentifier-D2LLE.Content.ContentObject.ModuleCO-9251897 A ✩ Os Google Maps News a Amazon.com - Onli... PQ language English ar... LastPass Women's Stretch T... Assignment: Price Controls After a Storm Other favor B, Assignment Due July 20 at 11:59 PM In 2014, a major ice storm hit the southeastern U.S. The storm brought down power lines and trees, cutting electricity in many areas, making travel difficult, and slowing down repair crews. Heating homes became a major challenge. The storm created shortages of power generators. As a result, those products sold at prices much higher than normal. These high prices provoked cries of "price gouging" and calls on the government to impose price controls to prevent gouging. While no one likes to pay a higher price than normal for something, consider what would have happened with a price ceiling. The economic intuition is revealing. Draw a diagram showing the market for generators with an equilibrium price at $250. Now impose a price ceiling at $200 per generator. What would be the impact of the price ceiling on the quantity demanded? On the quantity supplied? Who would benefit from the price ceiling and who would be harmed? Let the graph guide your thinking. Don't start with your gut reaction! Did the price ceiling help the people it was designed to help? Explain the economic reasoning behind your analysis. Module 4 Quiz ? Quiz Due July 20 at 11:59 PM Q Search hp 7/18/203
New tab x Augusta Bar X UMA-UMA X BM04: Applicat X Price Ceilings X Syllabus-MU x + content/349328/Home?itemIdentifier-D2LLE.Content.ContentObject.ModuleCO-9251897 A ✩ Os Google Maps News a Amazon.com - Onli... PQ language English ar... LastPass Women's Stretch T... Assignment: Price Controls After a Storm Other favor B, Assignment Due July 20 at 11:59 PM In 2014, a major ice storm hit the southeastern U.S. The storm brought down power lines and trees, cutting electricity in many areas, making travel difficult, and slowing down repair crews. Heating homes became a major challenge. The storm created shortages of power generators. As a result, those products sold at prices much higher than normal. These high prices provoked cries of "price gouging" and calls on the government to impose price controls to prevent gouging. While no one likes to pay a higher price than normal for something, consider what would have happened with a price ceiling. The economic intuition is revealing. Draw a diagram showing the market for generators with an equilibrium price at $250. Now impose a price ceiling at $200 per generator. What would be the impact of the price ceiling on the quantity demanded? On the quantity supplied? Who would benefit from the price ceiling and who would be harmed? Let the graph guide your thinking. Don't start with your gut reaction! Did the price ceiling help the people it was designed to help? Explain the economic reasoning behind your analysis. Module 4 Quiz ? Quiz Due July 20 at 11:59 PM Q Search hp 7/18/203
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Answer the questions in the text
Transcribed Image Text:New tab
x
Augusta Bar X
UMA-UMA X BM04: Applicat X
Price Ceilings X
Syllabus-MU x +
content/349328/Home?itemIdentifier-D2LLE.Content.ContentObject.ModuleCO-9251897
A ✩
Os Google Maps
News a Amazon.com - Onli... PQ language English ar...
LastPass Women's Stretch T...
Assignment: Price Controls After a Storm
Other favor
B, Assignment
Due July 20 at 11:59 PM
In 2014, a major ice storm hit the southeastern U.S. The storm brought down power lines and trees,
cutting electricity in many areas, making travel difficult, and slowing down repair crews. Heating
homes became a major challenge. The storm created shortages of power generators. As a result,
those products sold at prices much higher than normal. These high prices provoked cries of "price
gouging" and calls on the government to impose price controls to prevent gouging. While no one
likes to pay a higher price than normal for something, consider what would have happened with a
price ceiling. The economic intuition is revealing.
Draw a diagram showing the market for generators with an equilibrium price at $250. Now impose
a price ceiling at $200 per generator. What would be the impact of the price ceiling on the quantity
demanded? On the quantity supplied? Who would benefit from the price ceiling and who would be
harmed? Let the graph guide your thinking. Don't start with your gut reaction! Did the price ceiling
help the people it was designed to help? Explain the economic reasoning behind your analysis.
Module 4 Quiz
? Quiz
Due July 20 at 11:59 PM
Q Search
hp
7/18/203
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