Suppose that the free- market equilibrium price of natural gas would be $2.00 per unit, but 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.

Question

Quizplus · Accepted Answer

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

Suppose That the Free- Market Equilibrium Price of Natural Gas