Equating demand and supply functions to find surplus and shortage.
1. In a competitive market, the market demand is Qd = 60 - 6P and the market supply is Qs = 4P. A price ceiling of $3 will result in
a) A shortage of 18 units.
b) A surplus of 12 units.
c) A surplus of 30 units.
d) A shortage of 30 units.
e) neither a shortage nor a surplus.
2. In a competitive market, the market demand is Qd = 70 - 3P and the market supply is Qs = 6P. A price ceiling of $4 will result in
a) A surplus of 58 units.
b) A shortage of 34 units.
c) A shortage of 24 units.
d) A surplus of 34 units.