Question
The Federation of Vegetable Farmers Association of Malaysia reported that a lack of workers caused a 25% drop in production that drove up vegetable prices
The Federation of Vegetable Farmers Association of Malaysia reported that a lack of workers caused a 25% drop in production that drove up vegetable prices by between 50% and 100%. Consumers called for a price ceiling on vegetables.
Show (1) why the price increased to begin with, and (2) predict the effects of a binding price ceiling
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Introduction to Econometrics
Authors: James H. Stock, Mark W. Watson
3rd edition
133595420, 978-0138009007, 138009007, 978-0133486872, 133486877, 978-0133595420
