When the polio vaccine first became available in the United States, the government controlled the price with an effective price ceiling. Production of the vaccine was not sufficient to fill all orders and the government had to regulate its distribution. Had the vaccine been sold without government intervention, the shortage would have been eliminated by price:
A) falling, quantity demanded decreasing, and supply increasing.
B) falling, demand decreasing, and supply increasing.
C) rising, demand decreasing, and quantity supplied increasing.
D) rising, quantity demanded decreasing, and quantity supplied increasing.

Question

Quizplus · Accepted Answer

A price ceiling kept the price below equilibrium, causing a shortage. Without it, prices would rise, reducing quantity demanded and increasing quantity supplied, eliminating the shortage.

When the Polio Vaccine First Became Available in the United