Refer to Exhibit 4-11. Suppose that the government imposes a price ceiling in the market for good ABC at a price of $4. How many fewer units would be exchanged at the price ceiling than would be exchanged if the market for good ABC were a free market?

Respuesta :

The question is incomplete as the exhibit is not provided, however the correct exhibit table is attached with the answer-

Answer:

The correct answer is -  40.

Explanation:

In the price ceiling, The government added a price over which companies can not charge for their particular products. In this scenario, the government charges a price ceiling of $4.

Without price ceiling, equilibrium in the market would have occurred at $5 where the amount requested equivalents amount provided (80 units). In any case, since the firm is compelled to charge $4, there will be an abundance of demand in the economy. From the demand and supply plan we can see that at a cost $4 amount requested is 100 units and the amount provided is 40 units. Consequently, at max, 40 units can be traded in the market at value of $4.

Thus, the correct answer is - 40.

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