An Unintended Consequence of Price Ceilings Is

question 107

Multiple Choice

An unintended consequence of price ceilings is:

• A) the loss of surplus always outweighs the benefits of the policy.
• B) non-price rationing must occur, and can lead to bribes.
• C) the transfer of surplus from producer to consumer rarely is recognized.
• D) the producers increase the quality of the goods sold.

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Definitions:

Past Consideration

A promise to give another something of value in return for goods or services rendered and delivered in the past.

Bargained-For-Agreement

An arrangement reached after negotiation between parties, where each side gives something in exchange for what it receives.

Forbearance

An agreement between a lender and a borrower to temporarily suspend debt payments.

Accord and Satisfaction

A legal agreement whereby disputes are settled by the parties agreeing to accept something different from what was originally expected.