Which of the following is likely to happen if the government imposes a price control at $60,when the demand curve shifts to D₂?
A) There will be a shortage of 15 units of the good in the market.
B) There will be a surplus of 15 units of the good in the market.
C) There will be a shortage of 10 units of the good in the market.
D) There will be a surplus of 10 units of the good in the market.

Question

Quizplus · Accepted Answer

When a government imposes a price control below the equilibrium price and demand increases (shifts to D₂), it typically leads to a shortage because the price is kept artificially low, increasing the quantity demanded while possibly decreasing the quantity supplied.

Which of the Following Is Likely to Happen If the Government