Price Ceilings and consequences

Economics
Tutor: None Selected Time limit: 1 Day

Important consequence of price ceilings, "a persistent shortage develops because quantity demanded exceeds quantity supplied. What is an ethical value that is challenged in this consequence?

May 30th, 2015

well a price ceiling is something that prevents the price from rising above that point. Meaning that in an emergency then the company is not allowed to charge excessive prices too take advantage of people. Because of the prevention of being able to raise prices the quantity demanded increases which causes a bigger shortage, meaning that its first come first serve well if the price was increased it would be able to help the economy more because the people who truly needed it would be able to get it unlike when the price is prevented from rising many people may buy excessive stuff and not show any remorse for it. This is the same for bread when it is in shortage because of a price ceilling not everyone is able to get it. By having a price ceiling people stock up on stuff and prevent others from being able to get it, as well as with rent it prevents the landlords from performing their duties adequately since they have no initiative or motivation to do so.

May 30th, 2015

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May 30th, 2015
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May 30th, 2015
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