macroeconomics chapter 6 review
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shortages result when
a binding price ceiling is imposed
a minimum wage set above equilibrium will result in?
an excess supply of labor... unemployment
when will a price ceiling be binding?
below equilibrium price
price ceilings and price floors that are binding clause what?
shortages and surpluses because they can not adjust to the market equilibrium.
what is a price ceiling?
the maximum price of a good
what are policymakers doing when they set prices by legal decree?
they are obscuring the signals that normally guide the allocation of society's resources.
what outcome can result from price ceilings and price floors?
undesirable rationing mechanisms
when is a price ceiling not binding?
when it is above equilibrium
