Multiple Choice
Which of the following statements is true if the government places a price ceiling on petrol at €1.50 per litre and the equilibrium price is €1.00 per litre?
A) A significant increase in the demand for petrol could cause the price ceiling to become a binding constraint.
B) A significant increase in the supply of petrol could cause the price ceiling to become a binding constraint.
C) There will be a shortage of petrol.
D) There will be a surplus of petrol.
Correct Answer:
Verified
Correct Answer:
Verified
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