After natural disasters such as hurricanes, the prices of necessity goods such as bottled water, generators, milk, and so forth, in the areas hit by the hurricane tend to increase dramatically. Many consumers and politicians have termed these increases "price gouging," as they insinuate that suppliers are taking advantage of consumers when they are most vulnerable. Governments have even gone so far as to make price gouging illegal, saying in many places that it is illegal to charge any price significantly higher than "pre-hurricane prices." From an economic standpoint, are these laws that prohibit price gouging efficient? What would happen if these laws were repealed and prices were allowed to increase?
Correct Answer:
Verified
View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Q256: Ignoring any third-party commissions, the profit one
Q257: In prediction markets, the probability of an
Q258: A futures contract can make a future
Q259: Ethanol is the active ingredient in alcoholic
Q260: Because people have short memories, an oil
Q262: If gold currently sells for $1,500 per
Q263: Suppose you have been hired by the
Q264: Recall from the text that weather is
Q265: A wheat farmer plans to retire at
Q266: When Walmart arrives in a small town,
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents