If a price ceiling is binding, then
A)there will be no effect on the market price or quantity sold.
B)there will be a surplus in the market.
C)the market will be more efficient than it would be without the price ceiling.
D)there will be a shortage in the market.

Question

Quizplus · Accepted Answer

A binding price ceiling is set below the equilibrium price, leading to a situation where the quantity demanded exceeds the quantity supplied, causing a shortage in the market.

If a Price Ceiling Is Binding, Then