What are the major problems that will tend to arise if there are legal limits on the movement of prices?
A)favoritism and corruption of officials and market participants
B)unenforceability of laws and higher costs of transactions
C)increasing restrictions to enforce the laws
D)misallocation of resources as prices no longer correspond to costs
E)All of the above are correct.

Question

What are the major problems that will tend to arise if there are legal limits on the movement of prices?
A)favoritism and corruption of officials and market participants 
B)unenforceability of laws and higher costs of transactions 
C)increasing restrictions to enforce the laws 
D)misallocation of resources as prices no longer correspond to costs 
E)All of the above are correct.

Quizplus · Accepted Answer

Legal limits on price movements can lead to favoritism, corruption, unenforceability, higher transaction costs, increased restrictions, and misallocation of resources, as prices may not reflect true costs.

What Are the Major Problems That Will Tend to Arise