Suppose the market supply is initially at S1 and a price ceiling is set at 8. If supply shifts from S1 to S2, then
A. The price ceiling will no longer bind.
B. The price ceiling will prevent output from changing.
C. The size of the shortage will increase.
D. The market will not reach equilibrium.
A. The price ceiling will no longer bind.
Economics
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The utility-maximizing rule:
A) is inconsistent with the law of demand. C) implies a leftward shifting demand curve. B) implies a perfectly elastic demand curve. D) is consistent with the law of demand.
Economics
Suppose the quantity of money and real GDP do not change. If velocity increases, then the
A) price level will fall. B) price level will rise. C) inflation rate will fall. D) real interest rate will fall. E) real interest rate will rise.
Economics