What economic consequence typically arises when a government imposes an effective binding price ceiling (maximumprijs) below the market equilibrium price?
Answer and explanation
Correct answer: C. A market shortage (aanbodoverschot / excess demand) where quantity demanded exceeds quantity supplied
- Step 1: A price ceiling set below equilibrium makes the good cheaper, causing quantity demanded to rise while suppliers produce less. Step 2. This gap creates persistent excess demand (shortage), often requiring rationing or queuing. Answer: A market shortage (aanbodoverschot / excess demand) where quantity demanded exceeds quantity supplied. Why not the others: A market surplus is caused by price floors (minimumprijzen); price ceilings generate deadweight loss rather than eliminating it.
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