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A second system of nonprice rationing is with coupons. In this system, the government distributes coupons that must be presented along with money in order to buy a product. Coupons restore buyer equilibrium because they change the cost of a product, though in a different way than queuing does. Under the system of queuing, the cost of a product ...
- Price Controls
Rationing will be on a first-come, first-served basis, and...
- Pictures of Ration Books
More Illustrations of War Ration Books. Here are...
- Price Ceilings
1 This discussion of price ceilings and floors assumes that...
- Allocating and Rationing
Explain why prices can be a way of rationing. Explain the...
- Price Controls
This article examines the implications of using waiting times, rather than co-payments, as a rationing device. It discusses theoretical issues, empirical and policy issues, and the meaning of an optimal waiting time.
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What is a rationing device?
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A price ceiling policy intended to lower prices for the poor may cause shortages, the use of nonprice rationing devices, illegal market transactions, and tie-in sales. Price floor A government-mandated minimum price below which legal trades cannot be made.
- Price as A Rationing Device
- Information
- Price Controls
- Price Ceilings
- Price Floors
A rationing device is a mechanism used to determine who gets what of available limitedgoods and resources. One of the most commonly used rationing devices used in acapitalistic (market-based) economic system is price. Those who are willing and able topay the price for a given good (or resource) can purchase it. Other rationing devicesare used, as w...
Price serves purposes other than that of a rationing device. In a market-basedeconomy, price also transmits information about the relative scarcity of a good. Goodsthat are relatively more scarce have a higher price and those that are relatively lessscarce have a lower price.
Up until this point in our study of supply and demand, we have assumed that thegovernment has stayed out of the pricing decisions and allowed prices to adjust toequilibrium. However, sometimes the government chooses (for a variety of reasons) tointervene and impose price controls. There are two main types of price controls: priceceilings and price ...
A price ceiling is the highest price that a product can legally be sold for as determinedby the government. The placement of the price ceiling, in relation to the equilibriumprice, will have a lot to do with whether or not the price ceiling will actually have anyimpact on the price the product is sold for. If a price ceiling is set above the equili...
A price floor is the lowest price that a product can legally be sold for as determined bythe government. The placement of the price floor, in relation to the equilibrium price,will have a lot to do with whether or not the price floor will actually have any impact onthe price the product is sold for. If a price floor is set below the equilibrium pri...
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If a college sets its tuition _____ the equilibrium tuition, then it will have to use some form of nonprice-rationing device to determine who will be accepted for admission to the college. a. equal to or above b. equal to c. below d.above
Price as a rationing device: Rationing device is needed, as a result of scarcity, to determine who gets what of the available limited resources and goods. It rations resources/ goods to the producers/ buyers who pay the price for the resources/goods.
Jan 1, 2012 · Download Citation | Non-Price Rationing and Waiting Times | This article examines the implications of using waiting times, rather than co-payments, as a rationing device. It discusses theoretical ...
