When an effective price ceiling is removed, we would expect the price of the good to:
A) increase and the quantity demanded to decrease.
B) increase and the quantity demanded to increase.
C) decrease and the quantity demanded to decrease.
D) decrease and the quantity demanded to increase.

Question

Quizplus · Accepted Answer

When an effective price ceiling is removed, the price is likely to increase to the equilibrium level, leading to a decrease in the quantity demanded as the price rises.

When an Effective Price Ceiling Is Removed, We Would Expect