A predictable result of the imposition of binding price floors or price ceilings is
A)shortages.
B)a reduction in quantities exchanged.
C)surpluses.
D)production control by the government.
E)a more equitable distribution of commodities.

Question

Quizplus · Accepted Answer

Binding price floors or ceilings disrupt the natural equilibrium of supply and demand, leading to a reduction in the quantities exchanged as the market cannot clear at the imposed price.

A Predictable Result of the Imposition of Binding Price Floors