If the government removes a binding price ceiling from a market,then the price paid by buyers will
A)increase,and the quantity sold in the market will increase.
B)increase,and the quantity sold in the market will decrease.
C)decrease,and the quantity sold in the market will increase.
D)decrease,and the quantity sold in the market will decrease.

Question

Quizplus · Accepted Answer

A binding price ceiling keeps the price below the equilibrium, causing a shortage. Removing it allows the price to rise to equilibrium, increasing both price and quantity sold.

If the Government Removes a Binding Price Ceiling from a Market,then