Asked Jul 19, 2019

Let’s say that Marianne is a politician who promises cheaper gasoline for everyone in the country if she is elected. Once she is elected, she makes gas cheaper by imposing a price ceiling that is one full dollar less than the market’s equilibrium price. Would she expect to be reelected in the long run?


Expert Answer

Step 1

From the aforementioned question, it can be stated that Marianne is one of the politicians who are competing for election and promises to reduce the gasoline price by $1 from the equilibrium price; hence,...


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P 3 F 2- ' Q Quarity of gaudin Q" PRICE OF AAtOLINE


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