If a binding price ceiling were placed in the market in the graph shown:

Name: If a binding price ceiling were placed in the market in the graph shown:
Brand: Quizplus
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Question

Quizplus · Accepted Answer

If a binding price ceiling were placed below the equilibrium price, it would cause the price to be artificially low. This would lead to an excess demand as the quantity demanded would be more than the quantity supplied at that price level. Therefore, choice A is correct. The demand and supply curves would not shift in this case.

If a Binding Price Ceiling Were Placed in the Market