Which Statement About Price Ceilings Is Correct

question 49

Multiple Choice

Which statement about price ceilings is correct?

• A) Whether a price ceiling is placed below or above the equilibrium price, it will always cause deadweight loss.
• B) A price ceiling will only cause deadweight loss if it is placed above the equilibrium price.
• C) A price ceiling will only cause deadweight loss if it is placed below the equilibrium price.
• D) Whether a price ceiling is placed below or above the equilibrium price, it will always cause a shortage of the good.

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Definitions:

Autokinetic Illusion

A visual phenomenon where a stationary point of light in a dark environment appears to move due to small involuntary eye movements.

Binocular Disparity

The difference in image location of an object seen by the left and right eyes, contributing to depth perception.

Ocular Disparity

The difference in the visual images that each eye perceives because of the eyes' horizontal separation, which is used for depth perception.

Visual Reference

An object, document, or display that one can look at to obtain information or inspiration.