CS 8.1 Pr Cntrls ConsSurp_Conclusions

CS 8.1 Pr Cntrls ConsSurp_Conclusions - on TCS depends on...

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CLASS SUPPLEMENT # 8.1 PRICE CONTROLS AND CONSUMER SURPLUS If neither demand nor supply is perfectly elastic or perfectly inelastic: C An effective price ceiling may or may not enlarge TCS. Because the price effect is positive and the quantity effect is negative, their combined net effect
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Unformatted text preview: on TCS depends on the elasticities of demand and supply. C An effective price floor always reduces TCS. (Both the price effect and the quantity effects on TCS are negative.) D:\Econ202\CS\CS 8.1 Pr Cntrls ConsSurp_Conclusions.wpd...
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