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Economics Lecture Three (view source)
Revision as of 20:44, September 15, 2009
, 20:44, September 15, 2009→Assignment: better
6. Give an example of a "normal" good, and an example of an "inferior" good.
6. Give an example of a "normal" good, and an example of an "inferior" good.
7. A "price ceiling" is a type of price control that sets the maximum price allowed by law for something (like a real ceiling). A "price floor" is a type of price control that sets a minimum price allowed by law for something (like a real floor). Does a price ceiling that is set below the free market price cause a surplus or a shortage? Please explain.
7. A "price ceiling" is a type of price control that sets the maximum price allowed by law for something (like a real ceiling). A "price floor" is a type of price control that sets a minimum price allowed by law for something (like a real floor). Does a price ceiling that is set below the free market price cause a surplus or a shortage? Please review the graph in the lecture, and explain why a surplus or a shortage is created by a price ceiling.
===Honors===
===Honors===