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    Question

    When a price ceiling is imposed in a market,

    A a persistent shortage result Correct Answer Incorrect Answer
    B a persistent surplus result Correct Answer Incorrect Answer
    C sellers of the product are made better off Correct Answer Incorrect Answer
    D no one is made better off Correct Answer Incorrect Answer

    Solution

    If a price suddenly begins to rise too rapidly, the government can stop the increase by setting a price ceiling in the market. The price ceiling is a maximum price. Of course, the ceiling creates problems of its own — chronic excess demand.

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