Suppose a Price Ceiling Is Set by the Government Below

question 204

Multiple Choice

Suppose a price ceiling is set by the government below the market equilibrium price. Which of the following will result?

• A) The demand curve will shift to the left.
• B) The quantity demanded will exceed the quantity supplied.
• C) The quantity supplied will exceed the quantity demanded.
• D) There will be a surplus.

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Definitions:

Expected Growth Rate

The annual rate at which an investment, company revenue, or economy is expected to grow over a future period.

Rate of Return

The achievement or shortfall in value of an investment during an established time, shown as a percentage of the investment’s original financial input.

Dividend

A portion of a company's earnings distributed to shareholders, typically in the form of cash or additional shares.

ROE

Return on Equity (ROE) is a financial ratio that measures a company's ability to generate profits from its shareholders' equity.