Question

A nonbinding price ceiling (i) causes a surplus. (ii) causes a shortage. (iii) is set at a price above the equilibrium price. (iv) is set at a price below the equilibrium price. g

Answer 1

A non-binding price ceiling

(iii) is set at a price above the equilibrium price.

Step-by-step explanation:

Generally, a non-binding price ceiling is set at a price that is greater than or equal to the market equilibrium price. The price ceiling is the maximum price chargeable. The opposite of a price ceiling is the price floor (the minimum price that can be charged). A binding price floor, like a non-binding price ceiling, is usually set above the market equilibrium price, while a binding price ceiling is set below the market equilibrium price.