Whenever a Shortage Occurs (For Example, in Parking Spaces), and the Price

question 2

Multiple Choice

Whenever a shortage occurs (for example, in parking spaces) , and the price does not rise or is not permitted to rise, some method of non-price rationing must occur (for example, driving around looking for a parking space) . Which of the following is an advantage of price rationing relative to non-price rationing methods?

• A) Economic theory indicates that price rationing leads to a less economically efficient allocation of goods.
• B) Non-price rationing techniques redistribute income from consumers to producers; price rationing does not.
• C) The demand for goods will be more elastic if price rationing is used to allocate goods.
• D) When higher prices are used to resolve shortages, the higher prices will encourage suppliers to increase the quantity available.

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Definitions:

Noncustodial Father

A father who does not have legal custody of his child, meaning the child resides primarily with the other parent.

Custodial Parent

The parent granted primary physical and/or legal guardianship of a child by a court order.

Stepfather

Stepfather is a man who is married to one's parent after the divorce or separation of one's biological parents, or the death of one's biological father, and who may serve as a parental figure.

Stepparent

An individual who is married to a person who has one or more children from a previous relationship, but is not their biological parent.