Asked by katherine alvarez on May 21, 2024
Verified
Price ceilings are never binding when set above the equilibrium price.
Price Ceilings
Government-imposed limits on how high a price can be charged for a product, service, or commodity.
Equilibrium Price
The charge where the amount of merchandise supplied equals the amount consumers are willing to purchase.
- Comprehend the implications of price ceilings and floors in market equilibrium.
Verified Answer
MR
morgan rogersMay 25, 2024
Final Answer :
True
Explanation :
Price ceilings, when set above the equilibrium price, do not affect the market because the market price is naturally lower than the ceiling, allowing transactions to occur without interference.
Learning Objectives
- Comprehend the implications of price ceilings and floors in market equilibrium.