Which of the following is true of price ceilings?
A) Firms must charge the price established as a price ceiling.
B) A ceiling price below the free- market equilibrium price is not binding.
C) If the ceiling price is set above the free- market equilibrium price it will have no effect on the market.
D) With a non- binding ceiling price an excess demand for the product will develop.
E) With a binding ceiling price a surplus of the commodity will develop.
Correct Answer:
Verified
Q75: Q76: In competitive markets, price floors and price Q77: Partial- equilibrium analysis considers Q78: The diagram below shows the market for Q79: In general (and in the absence of Q81: In free and competitive markets, surpluses are Q82: Consider a market that is in equilibrium Q83: If at some administered price there is Q84: The use of legislated rent controls typically Q85: 
A) all markets simultaneously,
A)
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