If a Price Ceiling Is Set Above the Equilibrium Price,then

question 141

Multiple Choice

If a price ceiling is set above the equilibrium price,then

• A) there will be a surplus of the good.
• B) there will be a shortage of the good.
• C) there will be neither a shortage nor a surplus of the good.
• D) the price ceiling will generate revenue for the government.
• E) the price ceiling affects suppliers but not demanders.

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Definitions:

Agricultural Production

The process and methods used in the cultivation of plants and raising of animals for food, fiber, biofuel, medicinal plants, and other products used to sustain and enhance human life.

Labor Force

The total number of people employed and unemployed, seeking employment in an economy.

Marginal Cost

The additional expense incurred from creating one more unit of a product, highlighting how production costs change with output levels.

Culinary School

An educational institution that specializes in teaching cooking and food preparation skills.