Suppose that, at the market clearing price of natural gas, the price elasticity of demand is -1.2 and the price elasticity of supply is 0.6. What will result from a price ceiling that is 10 percent below the market clearing price?
A More information is needed.
B A shortage equal to 1.8 percent of the market clearing quantity
C A shortage equal to 0.6 percent of the market clearing quantity
D A shortage equal to 18 percent of the market clearing quantity
E A shortage equal to 6 percent of the market clearing quantity
D A shortage equal to 18 percent of the market clearing quantity
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If a price ceiling of $8 were placed in the market in the graph shown:
A. an excess supply of 7 would occur.
B. an excess supply of 15 would occur.
C. an excess supply of 23 would occur.
D. None of these is true.
A key issue in the presidential election of 2012 between President Obama and Mr. Romney concerned tax rates. President Obama favored increasing taxes, especially on the rich. As a result of a tax increase
A) the aggregate demand curve shifts leftward. B) the aggregate demand curve shifts rightward. C) the aggregate supply curve shifts leftward. D) the aggregate supply curve shifts rightward.