Question

1. Price ($) Quantity Demanded Quantity Supplied 0 4 0 1 2 3 4 5 6 7 21 18 15 12 9 6 3 0 8 12 16 20 24 28 a. If the government set a price ceiling at $2, would there be a shortage or surplus, and how large would be the shortage/surplus? b. If the government set a price ceiling at $4, would there be a shortage or surplus, and how large would be the shortage/surplus? c. If the government set a price floor at $4, would there be a shortage or surplus, and how large would be the shortage/surplus? d. If the government set a price floor at $2, would there be a shortage or surplus, and how large would be the shortage/surplus? e. In this market, over what range of prices would a price ceiling set by the government be binding? f. In this market, over what range of prices would a price floor set by the government be binding?

Answer 1

a. Shortage = 15. - 8 = 7

b. None because the price=ceiling would be non-binding as it is above the market equilbrium price.

c. SUrplus = 16 - 9 = 7

d. None because the price-floor would be non-binding as it is below the market equilbrium price.

Pls post remaining parts separately.