Why Are the Long-Run Consequences of a Price Control Different

question 128

Essay

Why are the long-run consequences of a price control different from the short-run consequences of a price control? Be specific,and consider both price floors and price ceilings in your answer.

---

Definitions:

Positive Expectations

The anticipation or belief that future events, outcomes, or actions will result in positive or favorable results.

Situations Involving Vulnerability

Circumstances that expose individuals or groups to the possibility of being harmed, physically or emotionally.

Calculus-based Trust

A form of trust predicated on the calculation and expectation that another individual will act in a predictable manner, often based on the perceived benefits and penalties associated with maintaining or betraying trust.

Deliver Promises

The act of fulfilling or keeping commitments and expectations previously agreed upon.