If the government implements a price ceiling on insulin,this will

Question

Quizplus · Accepted Answer

A price ceiling sets a maximum price that can be charged for a good. If the price ceiling is set below the market equilibrium price, it will create a shortage of the good. In the case of insulin, a price ceiling would likely decrease the quantity of insulin manufacturers are willing to supply, as they would not be incentivized to produce more at the lower price. It would not increase the price consumers pay for insulin, as the price ceiling caps the maximum price. It also would not encourage manufacturers to produce and sell more insulin, as they would not make as much profit at the lower price. Therefore, the best choice is B.

If the Government Implements a Price Ceiling on Insulin,this Will