To say that a price ceiling is binding is to say that the price ceiling
A)results in a surplus.
B)is set below the equilibrium price.
C)causes quantity supplied to exceed quantity demanded.
D)is set above the equilibrium price.

Question

Quizplus · Accepted Answer

A binding price ceiling is one that is set below the equilibrium price, which leads to a shortage because the quantity demanded exceeds the quantity supplied at that price.

To Say That a Price Ceiling Is Binding Is to Say