Suppose that the free-market equilibrium price of natural gas would be $2.00 per unit,but in an effort to protect consumers the government has fixed the price at $1.50.At this ceiling price the quantity ________ will be greater than the quantity ________,resulting in a ________ of natural gas.
A)demanded; supplied; surplus
B)supplied; demanded; surplus
C)demanded; supplied; shortage
D)supplied; demanded; shortage
E)demanded; supplied; reduction in equilibrium price

Question

Quizplus · Accepted Answer

When the government sets a price ceiling below the equilibrium price, the quantity demanded exceeds the quantity supplied, leading to a shortage.

Suppose That the Free-Market Equilibrium Price of Natural Gas Would