Use the figure below to answer the following question(s).
Figure 4-4
-Given the demand and supply conditions shown in Figure 4-4, what will happen as the result of imposing a price ceiling of a?
A) Demand for the product will decline.
B) Supply will increase.
C) There will be a shortage of the product.
D) Over time, the quality of the product offered by suppliers will increase.

Question

Use the figure below to answer the following question(s).
Figure 4-4 
-Given the demand and supply conditions shown in Figure 4-4, what will happen as the result of imposing a price ceiling of a?
A) Demand for the product will decline. 
B) Supply will increase. 
C) There will be a shortage of the product. 
D) Over time, the quality of the product offered by suppliers will increase.

Quizplus · Accepted Answer

A price ceiling set below the equilibrium price will result in a shortage because the quantity demanded will exceed the quantity supplied at that price.

Use the Figure Below to Answer the Following Question(s)