Principles of Economics, 7th Edition

Published by South-Western College
ISBN 10: 128516587X
ISBN 13: 978-1-28516-587-5

Chapter 6 - Part II - Supply, Demand, and Government Policies - Questions for Review - Page 129: 2

Answer

Prices ceiling causes a shortage of a good.

Work Step by Step

Prices ceiling becomes binding. The draw explains that consumers are willing to buy in point QD, but producers are willing to sell at point QS. The shortage is measured by subtracting QD minus QS.
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