Which of the following would be the least likely result of a binding price ceiling imposed on the market for rental cars?
A)an accumulation of dirt in the interior of rental cars
B)poor engine maintenance in rental cars
C)free gasoline given to people as an incentive to a rent a car
D)slow replacement of old rental cars with newer ones

Question

Quizplus · Accepted Answer

A binding price ceiling would result in a shortage of rental cars, as the quantity demanded exceeds the quantity supplied at the artificially low price. Therefore, rental car companies would not need to incentivize customers with free gasoline as an incentive to rent, and instead may have to ration the available cars. However, the other three options are possible negative consequences of a price ceiling on rental cars - if the price companies can charge is limited, they may cut back on maintenance and investment in new cars to save costs.

Which of the Following Would Be the Least Likely Result