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Why is it true that shortages usually occur mainly when price controls are in effect?In the nonexistence of price controls the shortage generally goes away quickly because prices are bid up to remove the excess demand. But with price controls in effect the shortage generally persists. This helps describe why we generally only see long lines in effect while the government imposes a price ceiling like it did throughout the 1970s so-called gas crisis.
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conditions of pareto optimality
How do you draw the demand curve Q = 100 - 50P and indicate which portion of the curve is elastic, which is enelastic, and which is unit elastic?
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