Suppose the Current Equilibrium Price of Pizza Is $5

question 177

Multiple Choice

Suppose the current equilibrium price of pizza is $5.If the government decides the price of pizza cannot rise above $4, the result of this policy would be

• A)a shortage
• B)a surplus
• C)that the market would remain in equilibrium but with a larger quantity bought and sold than at $5
• D)at the $4 price, the quantity sold would be greater than the quantity bought
• E)a shift of demand to the right

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Definitions:

Federal Trade Commission

The Federal Trade Commission is an independent agency of the United States government, established to prevent unfair methods of competition and unfair or deceptive acts or practices in commerce.

Misleading Advertising

Marketing communications that knowingly or unknowingly deceive or mislead the audience, often leading to false impressions about a product or service.

Government Agency

An organization within the government responsible for the administration of specific functions or the enforcement of laws.

Second Amendment

A part of the U.S. Bill of Rights that protects the right of individuals to keep and bear arms.