Suppose that demand is given by the equation P= -8.8Q + 60 and supply is given by the equation P= 3.2Q + 12. a.Suppose the government sets the price at $51.20, and this prevents the price from adjusting to the market equilibirium. Is that price a price ceiling, a price floor, or neither? b. If P = $51.20 is there a shortage, a surplus, or neither? c. If P = $51.20, what quantity will be sold in the market?

Suppose that demand is given by the equation P= -8.8Q + 60 and supply is given by the equation P= 3.2Q + 12. a.Suppose the government sets the price at $51.20, and this prevents the price from adjusting to the market equilibirium. Is that price a price ceiling, a price floor, or neither? b. If P = $51.20 is there a shortage, a surplus, or neither? c. If P = $51.20, what quantity will be sold in the market?

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter5: Markets In Motion And Price Controls

Section: Chapter Questions

Problem 6P

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