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28 July, 22:51

Which situation is the most likely result of a price ceiling being set below the equilibrium price?

a. decreased demand

b. a surplus in the market

c. a shortage in the market

d. a higher equilibrium price?

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Answers (1)
  1. 28 July, 23:47
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    The equilibrium price is basically the ideal price that is determined when the demand and the supply for an item is equal. If you place the price bellow the equilibrium price, the price of the product will be lower than what the market is willing to pay, and as result you will have surplus of the item in the market.

    The correct answer is b.
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