-Exhibit 4-2 represents the orange juice market.The horizontal line represents a price ceiling imposed by the government.How many fewer units would be exchanged at the price ceiling compared to the number that would be exchanged at the equilibrium price?

Question

Quizplus · Accepted Answer

The price ceiling is below the equilibrium price, so the quantity supplied will be less than the quantity demanded. This will lead to a shortage, and the number of units exchanged will be less than the number that would be exchanged at the equilibrium price. The difference between the quantity demanded and the quantity supplied is 200 units, so the number of units exchanged at the price ceiling will be 200 units less than the number that would be exchanged at the equilibrium price.

-Exhibit 4-2 Represents the Orange Juice Market