A shortage will tend to occur at which price in Figure 4-21? A)P ₁ B)P ₂ C)P ₃ D)There will be no shortage at the prices shown.

Question

Quizplus · Accepted Answer

At price P ₃, the quantity demanded exceeds the quantity supplied, causing a shortage. At prices lower than this, there is no shortage as the quantity supplied exceeds the quantity demanded. At prices higher than this, there is no shortage as the quantity supplied exceeds the quantity demanded.

A Shortage Will Tend to Occur at Which Price in Figure