Question

A severe water shortage recently hit country X. The government wants to ensure that drinking water remains affordable to the public. What policy or steps should the government undertake?
A.Decrease spending on water reforms.
B.Introduce a price floor on drinking water.
C.Increase taxes for working individuals.
D.Introduce a price ceiling on drinking water.
E.Increase taxes for producers of drinking water.

Answer 1

The answer should be D. Introduce a price ceiling forwater.

Answer 2

Answer:

D.Introduce a price ceiling on drinking water.

Explanation:

A price ceiling is a maximum price at which producers can sell a certain product, this is often marked by the government and it is in order to mantain the economy stable and affordable for all individuals, is mostly done for basic necessity products, like water or certain foods, or electricity or gas, in this case from the options the only one that would represent a policy made to ensure the that water remains affordable for teh public would be to etablish a price ceiling.