To Enhance Their Prestige, Some Country Clubs Like to Point

question 345

Multiple Choice

To enhance their prestige, some country clubs like to point to the fact that they have a waiting list for new members. Even at clubs with high initiation fees, it is common that prospective members have to wait three or more years before there is room for them on the membership rolls. How do these country clubs set the price of membership to ensure that they have a waiting list?

• A) Set the membership price above the market clearing price.
• B) Set the membership price below the market clearing price.
• C) Set the price so that the quantity supplied of memberships exceeds the quantity demanded.
• D) Set the price at a level that will generate a surplus of memberships.

---

Definitions:

Legislative Rules

Regulations established by legislative bodies to guide the implementation and enforcement of laws.

Federal Administrative Agency

A body established by Congress that implements and enforces laws and regulations within a specific jurisdiction or area of federal responsibilities.

Interstate Commerce Commission

A regulatory agency in the United States created by the Interstate Commerce Act of 1887, originally tasked with regulating the railroads to ensure fair rates and to regulate other modes of transport.

Rule Making

The process by which government agencies formalize and enact regulations or standards that govern behavior within specific industries or areas.