A decrease in aggregate supply can result in:

The imposition of price ceilings on a market often results in

a. an increase in investment in the industry. b. a persistent surplus in the market. c. an increase in expenditures in the black-market. d. lower prices being offered on the black market.

If firms must pay full liability for accidents plus punitive damages, then

a. the private costs of firms' activities will be equal to the social costs. b. firms will have an incentive to make efficient choices. c. social welfare will be higher than if no punitive damages were assessed. d. firms will undertake less activity than would be socially optimal.