Which of the following statements is true about price ceilings?
A. Price ceilings cause goods to be rationed.
B. Price ceilings cause goods to be rationed by some other means than legally determined
market prices.
C. Ration coupons are the only way to ration goods when price ceilings are in place.
D. All of the other statements are correct.
Answer: B
Economics
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Appendix: When two or more "independent" variables are highly correlated, then we have:
a. the identification problem b. multicollinearity c. autocorrelation d. heteroscedasticity e. complementary products
Economics
If the consumption function shifts downward, which of the following is the most likely cause?
a. Consumers become more optimistic. b. The price level increased. c. Consumers' incomes increase. d. Real interest rates decrease.
Economics