The Price of a Good or a Service Can Be

Multiple Choice

The price of a good or a service can be determined by free interaction of demand and supply or by a government price regulation. One important difference between these two price- determining methods is

A) that a regulated price above the equilibrium price will always result in shortages.
B) there are no shortages or surpluses at the free- market equilibrium price.
C) one is capitalist and the other is communist.
D) regulated prices are fairer since more people can then afford the goods or services.
E) the government is in the best position to know the needs of the people.