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Black Markets May Develop as a Result of Price Controls

question 201

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Black markets may develop as a result of price controls because:


Definitions:

Note Payable

A written agreement where one party promises to pay another party a specific sum of money at a determined future date or on demand.

Interest Expense

The cost accrued on borrowed funds, reflected as a financial charge for the use of the lender's money.

FICA Withholding

Taxes that are automatically deducted from an employee’s wages for Social Security and Medicare, as mandated by the Federal Insurance Contributions Act.

Tax Rate

The percentage at which an individual or corporation is taxed, varying by income or profits level and jurisdiction.

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