When a major storm is forecasted to impact a region (hurricanes, blizzards, etc) there is a run on basic supplies (food, gas, etc). A simple economic analysis would find prices of these goods should rise dramatically given the increased demand. However, anti- price gouging laws prevent this from happening. The anti- price gouging law serves as a price ceiling so firms cannot increase their price during times of crisis. Who benefits from these laws? Who is hurt by these laws?

When a major storm is forecasted to impact a region (hurricanes, blizzards, etc) there is a run on basic supplies (food, gas, etc). A simple economic analysis would find prices of these goods should rise dramatically given the increased demand. However, anti- price gouging laws prevent this from happening. The anti- price gouging law serves as a price ceiling so firms cannot increase their price during times of crisis. Who benefits from these laws? Who is hurt by these laws?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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When a major storm is forecasted to impact a region (hurricanes, blizzards, etc) there is a run on basic
supplies (food, gas, etc). A simple economic analysis would find prices of these goods should rise
dramatically given the increased demand. However, anti- price gouging laws prevent this from happening.
The anti - price gouging law serves as a price ceiling so firms cannot increase their price during times of
crisis. Who benefits from these laws? Who is hurt by these laws?

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