Question

1. Wildfires are threatening around California.

a. What happens to the D for emergency supplies like water and batteries?

b. What happens to the market for emergency supplies?

c. The government has made it illegal to raise P more than 10% in an emergency.(Penal Code Section 396.) What happens to the market for emergency supplies?

d. What are the benefits of this policy?

e. What problems will this policy create?

Answer 1

Answer.

A. The demand for emergency supplies like Water and Batteries would Rise.

B. Because of the increase in demand , The Price of emergency supplies in the market would rise .

C. The demand would rise but there would be limited supplies because of price control and hence there might be shortage of emergency supplies.

D. It will ensure that affordability of the emergency supplies is maintained .

E. It would lead to many people not receiving emergency supplies due to restricted Supply .