Which of the following is a major disadvantage of setting the price of a good below equilibrium and using waiting in line rather than price to ration the good?
A) Compared to price rationing, waiting in line is unfair since it is easier for those with higher incomes to wait in line.
B) Waiting in line imposes a cost on the consumer; paying higher prices does not.
C) Both waiting in line and higher prices are costly to consumers, but unlike the payment of a higher price, waiting in line does not provide suppliers with an incentive to expand future output.
D) Waiting in line benefits consumers at the expense of producers.

Question

Quizplus · Accepted Answer

Waiting in line imposes a cost on consumers without providing suppliers with an incentive to increase supply, unlike higher prices which can encourage more production.

Which of the Following Is a Major Disadvantage of Setting