Question

To keep the price of gas from rising quickly after Katrina, the government instituted price ceilings on the price of gasoline in some states. These price ceilings caused ______ in the gasoline market.

Answer 1

The correct answer is letter "D": shortages.

Step-by-step explanation:

Price ceilings are price limits imposed by the government to avoid producers increasing the price of goods that can be considered as basic or necessary. Then, the price ceiling will increase the demand for those goods but not the supply. Under this scenario, there will be a shortage of that product because of the excess in demand over supply.