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Refer to the Graph Shown

Question 178

Multiple Choice

Refer to the graph shown. Which statement best characterizes the difference between the effect of a price ceiling in the short run and the long run?

A) A price ceiling of P₀ will create a shortage of (Q₄ − Q₀) in the short run and the long run.
B) A price ceiling of P₂ will create a shortage of (Q₃ − Q₀) in the short run and a smaller shortage of (Q₃ − Q₁) in the long run.
C) A price ceiling of P₂ will create a shortage of (Q₃ − Q₁) in the short run, but a greater shortage of (Q₃ − Q₀) in the long run.
D) A price ceiling of P₀ will create a shortage of (Q₃ − Q₀) in the short run and the long run.