When the market clearing price of gasoline after a hurricane ...

[sabina]

When the market clearing price of gasoline after a hurricane spikes to 6.00 but legislators enact anti-gouging legislation that keeps prices at 4,
 
  A) consumers as a whole will tend to benefit.
  B) producers will have less incentive to bring gasoline to the areas where gasoline is most highly valued.
  C) government will ensure that no shortages will develo

Question 2

A ________ occurs when an economic activity has a spillover cost that does not affect those directly engaged in the activity.
 
  A) positive externality
  B) negative externality
  C) gain in producer surplus
  D) gain in consumer surplus

[bimper21]

Answer to Question 1

B

Answer to Question 2

B

[sabina]

TYSM

[pangili4]

Excellent