If a Government Imposed Price Ceiling Legally Sets the Price

question 226

Multiple Choice

If a government imposed price ceiling legally sets the price of beef below market equilibrium, which of the following will most likely happen?

• A) The quantity of beef demanded will decrease.
• B) The quantity of beef supplied will increase.
• C) There will be a surplus of beef.
• D) There will be a shortage of beef.

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Definitions:

Drawer

The person who writes or issues a check, draft, or bill of exchange, thereby creating an obligation to pay.

Payee

The individual or entity to whom money is payable, typically the recipient of a check or electronic payment.

Demand Instrument

A financial document, like a check or promissory note, that is payable on demand or presentation.

Time Instrument

A financial document that specifies payment to be made at a future date.