After a natural disaster, a price ceiling on bottled water will lead to:

Question

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A price ceiling sets a maximum price that sellers can charge for a product. In the case of bottled water after a natural disaster, a price ceiling would mean that sellers cannot charge more than a certain amount for their product. This means that the price would be lower than what it would be in a free market, leading to an increase in demand and a decrease in supply. This creates a shortage of bottled water, as there is more demand than there is supply at the controlled price.

After a Natural Disaster, a Price Ceiling on Bottled Water