Exhibit 4-7 In Exhibit 4-7, which of the following is true at the price ceiling, P?

Question

Exhibit 4-7  In Exhibit 4-7, which of the following is true at the price ceiling, P?

Quizplus · Accepted Answer

At the price ceiling, P, the quantity demanded exceeds the quantity supplied by 300 gallons, which is the excess quantity demanded. Therefore, option B is the correct answer. Option A and Option C are incorrect as they mention excess quantity supplied, which is not the case at the price ceiling. Option D is incorrect as it states the excess quantity demanded as 800 gallons, which is a combination of excess demand at both price ceiling and equilibrium price. Option E is incorrect as sales will be limited to the quantity supplied, which is only 500 gallons at the price ceiling.

Exhibit 4-7 in Exhibit 4-7, Which of the Following