If a price ceiling is imposed on a rental market for apartments,the more inelastic the supply of apartments,the
A) smaller the loss in total economic surplus.
B) larger the loss in total economic surplus.
C) smaller the gain in total economic surplus.
D) larger the gain in total economic surplus.
E) smaller the redistributed surplus.

Question

Quizplus · Accepted Answer

When supply is inelastic, producers cannot easily reduce the quantity supplied, leading to a smaller loss in total economic surplus when a price ceiling is imposed.

If a Price Ceiling Is Imposed on a Rental Market