Refer to the accompanying normal-form game of price competition. firm a firm b c d a 0,7 5,2 b 5,1 0,8 what is(are) the nash equilibrium(equilibria) strategy(ies) for this game?

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Answer 1

Nash equilibrium is a concept within game theory where the ideal outcome of a game is where there is no reason to deviate from the beginning strategy.

Let us consider the normal-form game of price competition shown below Firm A Firm B

What is Nash equilibrium?

A player can obtain the desired outcome by sticking to their initial strategy, according to the Nash equilibrium, a decision-making theorem in game theory.Each player's approach in the Nash equilibrium is the best one given what the other players have decided. Because everyone receives the result they want, everyone wins.The prisoners' dilemma is a well-known example from game theory that effectively illustrates the impact of the Nash equilibrium.The Nash equilibrium is frequently addressed in conjunction with dominant strategy, which holds that an actor's chosen approach will produce superior results than any other feasible strategy, independent of the opponent's strategy.

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Refer To The Accompanying Normal-form Game Of Price Competition. Firm A Firm B C D A 0,7 5,2 B 5,1 0,8

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Please Help me with this.

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Answer:Have you tried asking for help or you can just look it up and do research on it

Explanation:

A married couple opens a joint margin account. the brokerage firm will send the internal revenue service form 1099 (report of interest and dividends earned) to the?

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the brokerage firm will send the internal revenue service form 1099 to the person whose social security number was given on the account form

Two or more people can possess a joint brokerage account. According to Kevin Dugan, senior partner of Dublin, Ohio-based financial planning company Dugan Brown, "spouses, parents and children, or those with similar financial goals, such as business partners, most frequently use joint accounts."There are specifics to grasp under the broad notion of a joint brokerage account. Tim Gottfredson, a senior financial planner with EP Wealth Advisors in Salt Lake City and a licensed financial planner, says there are many sorts of joint registrations, each with its own specifics. When one owner of a joint tenants with rights of succession (JTWROS) account passes away, the remaining owner inherits the entirety of the account's assets.

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when a company must inform consumers that previous messages were wrong or​ misleading, it is engaging in​ .

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When a company must inform consumers that previous messages were wrong or​ misleading, it is engaging in corrective advertising.

What is advertising?

Advertising can be defined as a marketing technique that involves the use of promotional multimedia messages that are designed and developed with the intention of making the products (goods) or services offered by a business firm or an entrepreneur to become known, popular, and familiar to all of its customers and potential customers.

This ultimately implies that, consumer promotions programs (advertisement) such as online websites, can help a business firm in the following positive ways:

To generate store traffic.To enhance brand loyalty.To facilitate and influence the final decision to buy an item.

In accordance with the Federal Trade commission's order, a business firm must immediately engage in corrective advertising whenever it provides wrong, false or misleading messages to consumers, so as to rectify the misleading (wrong) impression that was created.

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the blank rate is the percentage of visitors or potential customers who take the action the marketer wanted them to take, such as making a purchase, downloading a report, or subscribing to a newsletter.

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The transformation rate is the percentage of visitors or potential customers who take the action the marketer wanted them to take, such as making a purchase, downloading a report, or subscribing to a newsletter.

What is the product transformation rate and the marginal rate?

The rate of product transformation is the rate of production at which one product is switched out for another while still using a fixed supply of inputs effectively. It is the proportion of units of one commodity given up to obtain an extra unit of another.

The quantity of units or amount of one good that must be sacrificed in order to produce or obtain one unit of another good is known as the marginal rate of transformation (MRT). When manufacturing costs and technological advancements are held constant, it is the number of units of good Y that must be sacrificed in order to generate an additional unit of good X.

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choose the method of pay that would result in the most earnings for one month on sales of $60,000. brainly

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the payment scheme that would yield the highest profits for a month on $60,000 in sales. a. 6% flat commission is applied to all sales.

Straight Commission: What Is It?

This kind of commission structure, sometimes known as commission-only compensation, links a salesperson's remuneration closely to their performance. In other words, salespeople only receive a commission from the products they sell.

For instance, a salesman who sells $123,550 worth of goods from their company and is paid 15% commission only receives $18,532.50. Other perks, including health insurance and a 401K, may be provided by the employer. However, the salesman only makes money on what they sell in terms of take-home income.

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Orecasts are vital inputs for the design and the operation of the productive systems because?

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Forecasts are important information for the design and operation of effective methods because they help managers to predict the future.

Why is forecasting important?

Forecasting is beneficial to businesses because it gives them the ability to drive informed business decisions and create data-driven strategies. Financial and operational decisions are created based on current market conditions and predictions of how the destiny looks.

Inventory forecasting is critical to confirm that a business does not surpass demand for a product, or run out of critical materials in the course of making it.

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Which online community characteristic specifies that virtual communities need norms in order to operate?

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The standard behavior specifies that virtual communities need norms in order to operate.

What is online community?

The online community means the community that has no physical existence and operated online.

In this question, we have to determine the online community characteristics specifies the norms to operate. The standard of behavior is the characteristic required. Because the feature set standards of the behavior in order to operate the online community. If these standards are not followed, then he is not able to operate the online community anymore and has to pay penalty or fine. These standards are also available in written. In some countries the standard of behavior is stricter also the punishment is also strict. Hence, from this we can say that the standard of behavior in the required characteristic.

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A(n) ________ seeks to coordinate and harmonize economic and social policies to facilitate the free flow of capital, labor, and goods and services from country to country.

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A(n) economic union seeks to coordinate and harmonize economic and social policies to facilitate the free flow of capital, labor, and goods and services from country to country.

This is further explained below.

What is an economic union?

Generally, An economic union is an agreement between two or more states that removes barriers to the free movement of capital, products, services, and labor across international boundaries.

In order to further strengthen this shared market, the nations may decide to coordinate their social and financial policies.

An example of an economic union is the European Union (EU), which stands for the European Union.

In conclusion,  A(n) economic union is an organization that aims to coordinate and integrate economic and social policies in order to make it easier for countries to trade freely with one another in terms of capital, labor, products, and services.

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essentials of marketing, 17e by william d. perrault, joseph cannon and e. jerome mccarthy, (mcgraw-hill, publisher).

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8 Marketing Essentials from William D. Perrault, Joseph Cannon, and E. Jerome McCarthy.

In the 17th edition of their essential marketing text, Marketing: Essentials, William D. Perrault, Joseph Cannon, and E. Jerome McCarthy introduce students to the eight vital principles of marketing that are consistently confirmed by successful marketers themselves, which they label as the 8 Essentials of Marketing )(p. ix).

Although these principles may seem simple and even obvious, they provide an excellent foundation to build upon as students move on to more advanced topics in the field of marketing.

William D. Perrault, Joseph Cannon, and E. Jerome McCarthy explain this concept in their book Essentials of Marketing by explaining the concept of market segmentation, which focuses on targeting one specific group of consumers that have needs that fit your company’s products or services.

Market segmentation involves looking at how similar or different your potential customers are from each other, the patterns of their behavior when purchasing goods and services, and how likely they are to buy what you are selling.

How can you do this? Keep these eight marketing essentials in mind.

 Understand your Customers: Understanding your customer's segment details the basics of how to get information about potential customers for a company's product or service.

The authors provide three questions to ask when getting the background of prospective customers: who are they? what do they want? and why do they buy?

Too better understand their needs, marketers need to be aware that people may use different products or services at different times throughout their lives based on life changes like marriage, divorce, the birth of children, etc.

2. Develop a Supportive Network: For Example, When a man started his last job in publishing, he didn't have a contact in the industry but he had a few people on social media that he followed so they could talk to each other and learn about the day-to-day running of publishing houses.

He is still not close to any of them in real life but they were instrumental in teaching me what goes on behind life - something nobody teaches you when you're just starting!

3. Create an Inviting Atmosphere: In deciding where to locate your business, take into account who you are selling to as well as what is available in the marketplace that meets the needs of your target market.

For example, if you sell beach apparel then locating on a busy shopping street with a lot of foot traffic would be a good idea.

Conversely, if you are looking for something less conspicuous such as a wholesale supplier of agricultural equipment then, an industrial warehouse in the suburbs might be ideal.

4. Get the Word Out about Your Business: Marketing is often an overlooked part of a new business launch, but it can be the most important aspect of securing success for your company.

There are many aspects to successful marketing campaigns: advertising on social media networks; doing research on your niche market; knowing what products or services you want to offer; creating promotions to bring people in-store or online; and more.

Start with what works best for you and the path that leads you toward success!

5. Take Advantage of Opportunities to Promote Your Business:

Whether you're an e-commerce business or a brick-and-mortar shop, there are many different ways to promote your company.

It is up to you to find the best fit for your company and budget by trying as many methods as possible until you find what works best for you.

You need to be fearless when it comes to trying new things!

6. Offer Superior Products and Services: Competitors will always exist for any company because the demand for products and services is high.

To make sure your company stands out in the market you need to differentiate what you offer by providing a higher quality product or service than your competitors can offer.

Your products and services should be convenient, affordable, good-quality, cost-effective, and that are worth their price point.

7. Charge Reasonable Prices: Charge a reasonable price for your product or service to compete with competitors who may charge less or offer a lower quality of service.

In general, customers will be more satisfied when they pay what they perceive as a fair price for the product or service, which allows you to increase repeat sales.

8. Monitor Performance: This is important to monitor because it will provide you with metrics such as the number of people who click on your ad or the number of sales that a particular promotion brings in.

For example, if you have an advertisement for a free t-shirt giveaway, monitoring performance means tracking how many people clicked on the ad versus how many people ended up ordering a t-shirt once they were directed to your site.

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you’re given the following assumptions for alibaba group holdings ltd.: based on the above information, what is the enterprise value of alibaba group holding limited? be sure to write down your answer, as you'll require it to calculate the next question's answer.

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According To the Question,

Market capitalization plus the market value of the debt less cash and cash equivalents equals enterprise value.

= 721195 - 157714 = 563481.

Therefore, choice C is the best one.

8. P/E ratio is determined using the following formulas:

= Earnings / Market Capitalization

In the situation and information provided, it is evident that second equations are used to compute P/E ratio since we must determine Enterprise Value in order to determine Market Capitalization, which can only be done by utilising second formulae.

Thus, using the second formula, we obtain:

Market capitalization / 149680

Market Capitalization equals six times 149680, or 898080.

Now,

Market capitalization plus the market value of the debt less cash and cash equivalents equals enterprise value.= 898080 - 157714 = 740366

Consequently, 740366 is the inferred enterprise value.

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Correct Question -- Review Later You're given the following assumptions for Alibaba Group Holdings Ltd.: {$/sh) [MM] SMM SMM SMM (SMM SMM Alibaba Group Holding Limited Share Price Shares Outstanding Market Cap Net Debt (Cash) NTM Revenue NTM EBITDA NTM Earnings $259.89 2.775 $721,195 ($157,714) $699,257 $205,663 $149,680 Based on the above information, what is the Enterprise Value of Alibaba Group Holding Limited? Be sure to write down your answer, as you'll require it to calculate the next question's answer. $858,333 $878,994 $563,481 $721,280 9 Review Later [S/sh.] AMM SMM {$MM [SMM (SMM SMM Alibaba Group Holding Limited Share Price Shares Outstanding Market Cap Net Debt (Cash) NTM Revenue NTM EBITDA NTM Earnings $259.89 2,775 $721,195 ($157,714) $699,257 $205,663 $149,680 Through a comparable company analysis for Alibaba, you determined a P/E ratio of 6.0x is appropriate to value the company. Based on this metric, what is the implied Enterprise Value of Alibaba? $898,073 $740,366 $1,391,693 $1,055,792

Epoetin alfa is a genetically engineered hemopoietin that stimulates the production of __________.

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Epoetin injection is the name for a synthetic version of human erythropoietin (EPO). EPO is a substance that the body naturally makes, primarily in the kidneys. It triggers the bone marrow to start producing red blood cells.

What is  erythropoietin (EPO)?

The glycoprotein cytokine erythropoietin, also called erythropoetin, haematopoietin, or haemopoietin, is primarily released by the kidneys in response to cellular hypoxia and stimulates the synthesis of red blood cells in the bone marrow.

In the kidney, interstitial fibroblasts work closely with the proximal convoluted tubule and peritubular capillary to create erythropoietin. Additionally, it is made in the liver's perisinusoidal cells. In the prenatal and postnatal stages, liver production is predominant; in adulthood, renal production is predominant. It and thrombopoietin are homologous.

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Identify and briefly explain the different types of systems used at the different levels of management in a business/organization.

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Three main categories of information systems serve different organizational levels: operational-level systems, management-level systems, and strategic-level systems.

The term "information" refers to everything with the capacity to inform and is hence abstract. Information, at its most basic level, deals with how something that may be experienced is interpreted. Any natural phenomenon that is not fully random and any discernible pattern in any medium can be said to communicate some level of information. Other occurrences and artifacts, including analog signals, poems, photographs, music or other sounds, and currents, use continuous forms of expression to communicate information, as opposed to the discrete signs used by digital signals and other data. Information can have meaning acquired from it by interpretation, not knowledge itself.

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Which marketing analytics tool is used to measure the percentage of total market sales captured by a brand, product, or firm?

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Market Share Analysis marketing analytics tool is used to measure the percentage of total market sales captured by a brand, product, or firm.

What is Market Share Analysis ?

Market share is the proportion of an industry's or market's total revenues achieved by a certain business over a given time period.

Market share is derived by dividing the company's sales for the period by the industry's total sales over the same period.

This indicator is used to get a sense of a company's size in relation to its market and rivals.

A market leader is a corporation in an industry with the largest market share and the most impact.

Implementing new technology and producing new revenue are examples of ways to gain market share.

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Suppose that coffee growers sell 200 million pounds of coffee beans at $2 per pound in 2007, and sell 240 million pounds for $3 per pound in 2008. based on this information we can conclude that the?

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Suppose that coffee growers sell 200 million pounds of coffee beans at $2 per pound in 2007, and sell 240 million pounds for $3 per pound in 2008, then in such case, law of demand is said to have been violated because of the increase in supply. Therefore, the option A holds true.

What is the significance of law of demand?

The law of demand can be referred to or considered as the law, which states that the demand for a product increases if there is a decrease in its price, and vice versa.

In the above situation, when the price of the coffee beans increased to $3, the law of demand got violated, as the supply went despite an increase in the price of the goods.

Therefore, the option A holds true and states regarding the significance of the law of demand.

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The missing choices to the incomplete question have been added for better reference.

Suppose that coffee growers sell 200 million pounds of coffee beans at $2 per pound in 2007 and sell 240 million pounds for $3 per pound in 2008. Based on this information we can conclude that the:

(a) Law of demand has been violated. Supply of coffee beans has increased.

(b) Law of supply has been violated. Demand for coffee beans has increased.

What happens to the equilibrium price and quantity when demand increases and at the same time supply decreases, but the demand shift is smaller than the supply shift?.

Answers

The situation that occurs to the equilibrium price and quantity when the demand increases and at the same time supply decreases but the demand shift is smaller than the supply shift is that both the equilibrium price and the equilibrium quantity will rise.

What is an equilibrium?

In economics, a equilibrium refers to the state in which market supply and demand balance each other and as a result, the prices become stable. Also, the equilibrium price is where the supply of goods matches demand and when a major index experiences a period of consolidation or sideways momentum, it can be said that the forces of supply and demand are relatively equal and the market is in a state of equilibrium.

However, the likely situation that occurs to the equilibrium price and quantity when the demand increases and at the same time supply decreases but the demand shift is smaller than the supply shift is that both the equilibrium price and the equilibrium quantity will rise. Therefore, the Option D is correct.

Missing options "The equilibrium price rises, and the equilibrium quantity falls. The equilibrium price falls, and the equilibrium quantity rises. Both the equilibrium price and the equilibrium quantity will fall. Both the equilibrium price and the equilibrium quantity will rise."

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The loanable funds theory views the level of interest rates as being determined by?

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According to the loanable funds theory, the level of interest rates is determined by the demand for and supply of loanable funds.

What is the loanable funds theory?

This is a theory that states that the interest rates in the market are determined by the amount of demand and supply there are for loanable funds.

For instance, the theory states that when the demand for loanable funds is high relative to the supply, the interest rate would rise as a result of the relative scarcity of loanable funds.

In conclusion, the loanable funds theory posits that the level of interest rates is as a result of the demand and supply of loanable funds.

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Compared to the results using the original cost curve (c = 100 38q), the increase in fixed costs means the bakery manager should:________

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Compared to the results using the original cost curve (c = 100 + 38Q), the increase in fixed costs means the bakery manager should change their price, but not change their quantity.

In accounting and economics, fixed costs, additionally called indirect prices or overhead prices, are enterprise prices that are not dependent on the extent of goods or offerings produced via the business. They have a tendency to be routine, including interest or rents being paid consistent with month. these expenses additionally tend to be capital prices.

What are fixed costs?

Fixed costs are prices which might be impartial of volume. Fixed costs tend to be expenses which might be based totally on time in preference to the amount produced or offered by using your enterprise. Examples of fixed costs are lease and hire costs, salaries, application bills, insurance, and loan repayments.

Is depreciation a fixed costs?

Sure, depreciation is a fixed costs. It is a routine cost this is commonly the equal amount each duration, in step with Accounting equipment. Depreciation isn't always typically affected by output. homes and machinery depreciate in price.

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how the value of one country's currency changes in relation to the value of other currencies is the premise behind

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The value of one country's currency changes in relation to the value of other currencies is the premise behind currency fluctuation.

The general functioning of the economy is significantly influenced by supply and demand. It refers to the widely held notion that making more of a certain commodity available will make it simpler for the value of a pair to hold steady.

The need or desire that individuals have for it, meantime, may contribute to increasing the pair's worth. The bank might eventually realize that the value of one currency is highly advantageous. As a result, more money is spent using a single currency. This increases the supply in turn. The other currency in a pair will be in higher demand.

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if an individual only consumes goods x and y and is currently maximing her total benefits, which of the following must be true

Answers

-No other choice of consumption can increase overall benefits

-the principle of "equal bang for the buck" is followed

-The marginal gains per dollar spent for both commodities are equal.

-MBx/Px=MBy/Py

What Is a Marginal Advantage?

The most a consumer will spend on an additional commodity or service is known as the marginal benefit. A consumer's further purchases involve the higher level of utility or happiness they will provide.

. With increased consumption of the commodity or service, the marginal benefit to the consumer tends to decline.

The term "marginal revenue" is frequently used in the business world to refer to the marginal advantage for producers.

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suppose that inflation is 2%. according to the data given in the article, what is the new real rate of interest on a 5-year car loan? give your answer to two decimals. smartwork

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Auto loan interest is calculated using simple interest rather than compound interest, it does not accrue interest. Of course, for people who require a car loan, the lower the rate, the better. The typical interest rate for a new car loan for customers with credit scores of 700 and higher has been 3.65%.

Your car is undoubtedly one of the most expensive investments you'll ever make, second only to a home. You'll also change vehicles a few times in your lifetime if you're like most individuals.

But let's face it, most of us can't afford to buy a car or truck entirely, so we must instead rely on loans. While some customers might use the automaker's financing offers, others might turn to external lenders. Any option you select will require you to repay the loan with interest.

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a manufacturer of cotton sells its product to a clothing manufacturer. this is an example of marketing

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A manufacturer of cotton sells its product to a clothing manufacturer. this is an example of business to business marketing.

What is business to business marketing ?

This can be described as a type of marketing that exists between two organisation. It typically involves wholesalers and retailer. In this type of marketing, a business can decide to sell their product to another business.

This type of marketing is very essential because a company or organisation may be in dire need of the products of another company, this may be required or needed to boost sales and growth. An example is a manufacturer that sells cotton to another clothing manufacturer to help produce their product. Another example is a cocoa farmer that sells his produce to factories that produce beverages. This way it is beneficial to both businesses.

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One approach to performing compaction is to do it when a certain ____ of memory becomes busy.

Answers

To execute compaction, one method is to wait until a specific percentage of memory becomes active.

Production of filter components using spherical powders, frequently made of bronze, is an exception to the compaction process. This procedure is known as "loose powder sintering," in which powder is placed into a mold with the desired shape and sintered there..

Enhancing the strength and bearing capacity of materials used in road construction is a key function of the compaction process. The grading, particle shape, organic and metal content of MIBA, moisture conditions, and compaction effort all affect the degree of compaction that can be achieved. The dry density-moisture content relationship for a specific compaction force has been established for this MIBA property utilizing the conventional proctor, modified proctor, and vibrating hammer tests.

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On+may+22,+jarrett+company+borrows+$7,600,+signing+a+90-day,+6%,+$7,600+note.+what+is+the+journal+entry+made+by+jarrett+company+to+record+the+transaction?

Answers

The journal entry was made by Jarrett company to record the transaction.

Debit cash $ 7500; credit Notes payable $ 7500.

Date Accounts titles and Explanation Debit ($) Credit ($)

cash   7500

     Notes payable  7500

A journal entry is an act of preserving or making records of any transactions both economic or non-monetary. Transactions are listed in an accounting journal that shows an enterprise's debit and credit score balances. The magazine access can include several recordings, each of that is both a debit or a credit.

A journal entry is used to file a business transaction inside the accounting records of a business. A magazine entry is typically recorded within the trendy ledger; rather, it can be recorded in a subsidiary ledger that is then summarized and rolled forward into the overall ledger.

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The competencies a leader needs to effectively manage an organization and carry out organizational goals are called ______ skills.

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The competencies a leader needs to effectively manage an organization and carry out organizational goals are called conceptual skills. Conceptual skills are mental abilities that allow you to absorb complex ideas and solve challenging situations. He can quickly perceive the big picture by analyzing and diagnosing various stages.

These abilities are valuable because they enable people to solve a wide range of problems through careful thought and abstract reasoning. Conceptual skills include the ability to identify and solve difficulties. Conceptual management skills necessitate the ability to make quick decisions when necessary. Conceptual talents demonstrate a manager's knowledge or capacity to think in a more abstract manner organization.

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occasionally, a salesperson may feel the need for legal advice, especially when preparing a sales contract. if so, the salesperson should

Answers

If a salesperson is in need of legal advice in preparing a sales contract, they should consult their supervisor or a lawyer.

Where should salespeople get legal advice from?

The question is incomplete as no options are given so I can only present a general answer.

If a salesperson is in need of legal advice when they are preparing a sales contract, they should talk to their immediate supervisor if they work in a company.

If they are independent, then they should reach out to a lawyer that is knowledgeable in sales law to help them with the contract.

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The gap between wealthy and low-income individuals within a population is called income.

Answers

Income disparity refers to the difference between rich and poor people within a population. The statement is false.

Income: What Is It?

The money that a person or organization earns in return for their labor or products is referred to as income. Depending on the situation, such as in taxation, financial accounting, or economic research, the definition of income may vary.

The majority of people define their income as all of their receipts, including wages and salaries, investment returns, pension payments, and other types of payments. Income for businesses is defined as the sum of all revenues from the sale of goods and services, as well as any interest or dividends connected to the business's cash accounts and reserves.

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After performing a comprehensive job search, job seekers put together a resume, write a cover letter, and then go on job interviews. this situation best exemplifies?

Answers

The process of performing a comprehensive job search, putting together a resume, and writing a cover letter best exemplifies b. scripts.

What are scripts?

Scripts in this context, refers to the stages that we follow when trying to accomplish certain things which in this case, is getting a job.

The script for getting a job calls for performing a job search, putting our resume together, writing a cover letter and then applying for a job. We then go on job interviews.

Options for this question are:

a. prototype.b. script.c.personal construct.d.stereotype.e. attribution.

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An integral part of the managerial process of crafting and executing strategy includes?

Answers

Setting goals and using them as benchmarks to measure the development and performance of the company is an essential part of the managerial process of developing and executing strategy.

What procedure governs the management of strategies?

The process of strategic management involves setting objectives, policies, and strategies to increase a company's or organization's competitiveness. Utilizing the resources and people on hand to achieve these objectives is the main focus of organizational development.

A strategic management process is used to carry out a key duty of a board of directors. This process helps a company and its leadership envision and make plans for the future. Strategic management determines the direction of the company and its workforce.

The five steps in the managerial process for developing and implementing strategy are:-

developing a strategic vision; establishing goals; developing a plan to achieve the goals and vision; implementing the plan; and monitoring developments, evaluating performance, and taking corrective action.

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bonita inc pays its employees twice a month, o the 7th and the 21th, bonita inc paid employee salaries of 4850. this transacton would

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The payment of salaries reduces the net income of the company.

The payment of the salaries means the payment made to the employees for their work. In this question, it is given that Bonita pays salaries to its employees twice a month. The amount of the salaries paid to the employees are 4,850. From this we have to describe the effect of this transaction. As we know that the payment of the salaries is an expense for the company so whenever the amount of the expense is paid it will reduce the cash of the company. The amount of cash is paid from net income of the company hence, it will reduce the amount of the net income of the company.

Hence, The company's net income is decreased by the payment of salaries.

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if the government sets out to help low-income people by establishing a maximum amount that can be paid for rent: a a price ceiling has been set and a surplus of rental units may occur. b in the long run more rental units will appear. c the quality of rental units will be inefficiently high. d a price floor has been set and a shortage of rental units may occur. e a price ceiling has been set and a shortage of rental units may occur.

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The correct answer is a. If the government sets out to help low-income people by establishing a maximum amount that can be paid for rent then a price ceiling has been set and a surplus of rental units may occur.

A price ceiling is a cap on the highest price that can be charged for a good, commodity, or service that is established by the government or another party. Governments implement price caps allegedly to safeguard consumers from situations when commodities might become unaffordable. Such circumstances may arise during times of high inflation, during an investment bubble, or when a company owns a monopoly on a particular good. If these conditions persist for an extended length of time without managed rationing, shortages may result. Unrealistic price limitations can lead to other issues, such as business failures, stock market crashes, or even economic catastrophes. Price ceilings do not exist in market economies that are not regulated.

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