Which of the Following Statements Best Differentiates Price Ceilings and Price

question 105

Multiple Choice

Which of the following statements best differentiates price ceilings and price floors?

• A) Price ceilings represent minimum prices, while price floors represent maximum prices.
• B) Binding price ceilings are always set below the equilibrium price, whereas binding price floors are always set above the equilibrium price.
• C) Price ceilings and price floors have the same effects.
• D) Price floors cause shortages to appear, whereas price ceilings have the opposite effect.
• E) Price ceilings are always effective, whereas price floors are rarely effective.

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Definitions:

Cultural Relativism

The principle that an individual's beliefs and activities should be understood by others in terms of that individual's own culture, emphasizing the idea that there is no absolute standard of right or wrong across cultures.

Results-Oriented

A focus on achieving specific goals and outcomes, emphasizing performance and accomplishment of targets.

Utilitarian View

An ethical perspective that evaluates actions based on the greatest good for the greatest number of people, emphasizing outcomes and consequences.