Consider a Price-Controlled Good Allocated to Consumers on a First-Come,first-Served

question 2

Multiple Choice

Consider a price-controlled good allocated to consumers on a first-come,first-served basis.Consumers end up waiting in line to purchase the good,and this:

• A)is more efficient,the higher the opportunity cost of the consumers' time in line.
• B)is more equitable than handing out coupons.
• C)is less efficient,the higher the opportunity cost of the consumers' time in line.
• D)is less equitable than handing out coupons.

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Definitions:

Present Value

Present value is the today's worth of an anticipated future amount of money or cash flows, factoring in a specified rate of return.

Discount

A reduction applied to the price of goods, services, or securities.

Future Value

The value of an asset or an amount of money at a specific point in the future, taking into account interest or capital gains.

Interest Rate

The percentage of an amount of money charged for its use over a specific period of time.