Price controls cause resources to be ________ not just geographically, but also across different ________ of those resources.
A) overutilized; types
B) properly allocated; demands
C) cheaper; uses
D) misallocated; uses

Question

Quizplus · Accepted Answer

Price controls create artificial distortions in the market, which can lead to misallocation of resources. This misallocation can occur not only geographically (i.e. resources being sent to the wrong places), but also across different types of those resources (i.e. too much emphasis on one type of resource at the expense of others). Therefore, option D is the best choice.

Price Controls Cause Resources to Be ________ Not Just Geographically