Narrbegin Exhibit 4.5 Supply and demand data for cars
$$\begin{array} { | c | c | c | }
\hline \begin{array} { c }
\text { Cars demanded } \
\text { per manth }
\end{array} & \begin{array} { c }
\text { Price per } \
\text { car (\$) }
\end{array} & \begin{array} { c }
\text { Cars supplied } \
\text { per manth }
\end{array} \
\hline 50 & 50 \text { 000 } & \text { 80 } \
\hline 55 & 40 \text { 000 } & 75 \
\hline 60 & 30000 & 70 \
\hline 65 & 20000 & 65 \
\hline 70 & 10000 & 55 \
\hline
\end{array}$$ Narrend
-In Exhibit 4.5, assume that the government sets a price ceiling of $10 000 for cars. What effect will this price change have?

Question

Narrbegin Exhibit 4.5 Supply and demand data for cars
 $$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Cars demanded } \
\text { per manth }
\end{array} & \begin{array} { c } 
\text { Price per } \
\text { car (\$) }
\end{array} & \begin{array} { c } 
\text { Cars supplied } \
\text { per manth }
\end{array} \
\hline 50 & 50 \text { 000 } & \text { 80 } \
\hline 55 & 40 \text { 000 } & 75 \
\hline 60 & 30000 & 70 \
\hline 65 & 20000 & 65 \
\hline 70 & 10000 & 55 \
\hline
\end{array}$$ Narrend
-In Exhibit 4.5, assume that the government sets a price ceiling of $10 000 for cars. What effect will this price change have?

Quizplus · Accepted Answer

A price ceiling set below the equilibrium price (in this case, $10,000, which is below all listed prices) can lead to shortages and thus incentivize the development of a black market as consumers seek ways to obtain cars that are not available at the artificially low price.

Narrbegin Exhibit 4 Narrend -In Exhibit 4

Narrbegin Exhibit 4 Narrend
-In Exhibit 4