Whenever there is a binding price ceiling (a price control that sets the price below the market equilibrium price)that changes the equilibrium quantity,all of the below occur except which option?
A) Demand increases.
B) There is a loss of social surplus.
C) Consumer surplus in the aggregate increases and producer surplus in the aggregate decreases.
D) Some consumers are made better off (they can purchase the good or service at a lower price) while other potential consumers are made worse off (queued out of the market).

Question

Quizplus · Accepted Answer

Whenever there is a binding price ceiling, demand does not increase, but rather exceeds the quantity supplied resulting in a shortage. This is because the price is below the equilibrium price, which means that the quantity demanded is greater than the quantity supplied. The other options are all accurate.

Whenever There Is a Binding Price Ceiling (A Price Control