7/30/2017 4:16 PM

-Refer to Situation 4-1.Because price controls were in effect at the time the embargo occurred,an economist would have most likely predicted that
A) the number of dollars one would need to pay at the pump (legally)for a full tank of gasoline would increase sharply.
B) the number of dollars one would need to pay at the pump (legally)for a full tank of gasoline would decline sharply.
C) nonprice-rationing devices,such as long waiting lines and black markets,would appear.
D) a surplus of gasoline would result.

Question

7/30/2017 4:16 PM
 
-Refer to Situation 4-1.Because price controls were in effect at the time the embargo occurred,an economist would have most likely predicted that
A) the number of dollars one would need to pay at the pump (legally)for a full tank of gasoline would increase sharply. 
B) the number of dollars one would need to pay at the pump (legally)for a full tank of gasoline would decline sharply. 
C) nonprice-rationing devices,such as long waiting lines and black markets,would appear. 
D) a surplus of gasoline would result.

Quizplus · Accepted Answer

When price controls are in effect, it leads to an excess demand for gasoline, which then results in nonprice-rationing devices such as long waiting lines and black markets. Therefore, an economist would likely predict that nonprice-rationing devices would appear during the embargo.

7/30/2017 4:16 PM -Refer to Situation 4-1.Because Price Controls Were in Effect at Controls