Part A: Draw a graph with hypothetical demand and supply curves. Label the axes, each curve, and the equilibrium. Pick a price-ceiling price below the equilibrium price, and label it on your graph as P^C.

Part B: Why don’t we choose a price ceiling above the equilibrium price?

Part C: On your graph, indicate the quantity consumers want to buy, Q^D C, and the quantity sellers want to sell, Q^S C.

Part D: Does a price floor cause a shortage or does it cause a surplus? Explain in words.

It all has to do with price ceiling :/ What do y'all think? Thanks so much!! :)

Question

Part A: Draw a graph with hypothetical demand and supply curves. Label the axes, each curve, and the equilibrium. Pick a price-ceiling price below the equilibrium price, and label it on your graph as P^C.

Part B: Why don’t we choose a price ceiling above the equilibrium price?

Part C: On your graph, indicate the quantity consumers want to buy, Q^D C, and the quantity sellers want to sell, Q^S C.

Part D: Does a price floor cause a shortage or does it cause a surplus? Explain in words.

It all has to do with price ceiling :/ What do y'all think? Thanks so much!! :)

jim_thompson5910 · Answer

what did you get for part A?

anonymous · Answer

heres what i have so far |dw:1414900826455:dw| is that right so far? kinda similar as the last one?

jim_thompson5910 · Answer

good

jim_thompson5910 · Answer

Pick a price-ceiling price below the equilibrium price, and label it on your graph as P^C.

anonymous · Answer

not quite sure how to do that part:/

jim_thompson5910 · Answer

what does "price-ceiling" in general?

jim_thompson5910 · Answer

mean in general* i meant

anonymous · Answer

price ceiling is the maximum price for a good or service set by the government right?

oh and haha didn't even see your typo lol :P

jim_thompson5910 · Answer

so it's the highest a price can go

jim_thompson5910 · Answer

set up a price max point that is somewhere below the equilibrium price

anonymous · Answer

|dw:1414901054524:dw| would that work?