"Prices gouging" is the practice of raising the price of essential goods during a shock to demand. An example is the demand for facemasks in the summer of 2020. Increases in price often cause distress, which has led policymakers to consider banning price increases during crises. Consider the costs and benefits of this policy in a supply and demand framework.

"Prices gouging" is the practice of raising the price of essential goods during a shock to demand. An example is the demand for facemasks in the summer of 2020. Increases in price often cause distress, which has led policymakers to consider banning price increases during crises. Consider the costs and benefits of this policy in a supply and demand framework.

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter8: Macroeconomic Equilibrium: Aggregate Demand And Supply

Section: Chapter Questions

Problem 12E

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