One likely result of a price ceiling is that:
A) a surplus of product would result.
B) the price charged in the market would be above the equilibrium price.
C) the price charged in the market would be the equilibrium price.
D) the available product must be rationed.
E) the market supply curve will shift to the right.

Question

Quizplus · Accepted Answer

A price ceiling is a government-imposed limit on how high a product can be sold on the market. When the imposed price is lower than the equilibrium price, it creates a shortage of product in the market, meaning that the available product must be rationed. This is why the answer is D.

One Likely Result of a Price Ceiling Is That