If the equilibrium price of natural gas is $4 per thousand cubic feet and a price ceiling is imposed at $3 per thousand cubic feet, the result will be:
A) a surplus of natural gas.
B) a shortage of natural gas.
C) an accumulation of inventories of unsold gas.
D) more natural gas available than what buyers want to buy.

Question

Quizplus · Accepted Answer

With a price ceiling set at $3 per thousand cubic feet, the price is below the equilibrium price of $4 per thousand cubic feet. This will lead to an increase in demand for natural gas, as buyers will be willing to purchase more at the lower price. However, suppliers will reduce the quantity supplied due to the lower price. This will result in a shortage of natural gas, as the quantity demanded will exceed the quantity supplied.

If the Equilibrium Price of Natural Gas Is $4 Per