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Up until the late 1970's, the price of airline tickets was controlled, set at a predetermined price above the market price. Draw a diagram showing
Up until the late 1970's, the price of airline tickets was controlled, set at a predetermined price above the market price. Draw a diagram showing the effect of the policy. Did the policy act as a price ceiling or a price floor? What kinds of inefficiencies were likely to have arisen when the controlled price of air travel was above the market price? Explain in detail.
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