A maximum price, set by the government, that sellers may charge for a good is known a A) a price floor B) a price rationing mechanism

Economics Aug 06, 2020

A maximum price, set by the government, that sellers may charge for a good is known a A) a price floor B) a price rationing mechanism. C) a price ceiling D) a subsidy.

Expert Solution

Ans..(c) a price ceiling

Price ceiling is the maximum price that can be charged by the sellers for a particular commodity which is set by the government due to excess demand in the market. Price ceiling always occurs below the equilibrium price.

Archived Solution

Unlocked Solution

You have full access to this solution. To save a copy with all formatting and attachments, use the button below.

Already a member? Sign In

Important Note: This solution is from our archive and has been purchased by others. Submitting it as-is may trigger plagiarism detection. Use it for reference only.

For ready-to-submit work, please order a fresh solution below.

Or get 100% fresh solution

Get Custom Quote