When the government imposes an $8 price ceiling on a good that would have had a $10 equilibrium price without the ceiling,

Question

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When the government imposes a price ceiling below the equilibrium price, it results in excess demand for the good. In this case, since the price ceiling is $8 and the equilibrium price is $10, consumers will demand more of the good at the lower price, but suppliers will not be willing to supply as much at the lower price. This will create a shortage or excess demand for the good.

When the Government Imposes an $8 Price Ceiling on a Good