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Which of These Statements Explains Why Price Ceilings Result in Lost

Question 99

Multiple Choice

Which of these statements explains why price ceilings result in lost gains from trade?


A) Buyers and sellers want to trade, but the threat of fines or jail time prevents them from doing so.
B) Sellers want to trade, but buyers prefer the lower prices.
C) Buyers want to trade, but sellers are indifferent at the lower prices.
D) Neither buyers nor sellers want to trade subject to a price ceiling resulting in lost gains from trade.

Correct Answer:

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