Refer to the accompanying figure,which shows both short-run and long-run demand and supply curves.If there is a $4 binding price ceiling imposed on a pharmaceutical drug,what will be the amount of the disequilibrium in the short run?
A)There will be a shortage of 1,500,000 units.
B)There will be a shortage of 800,000 units.
C)There will not be a shortage; there will be a surplus.
D)There will be a shortage of 2,000,000 units.
E)There will be a shortage of 500,000 units.

Question

Refer to the accompanying figure,which shows both short-run and long-run demand and supply curves.If there is a $4 binding price ceiling imposed on a pharmaceutical drug,what will be the amount of the disequilibrium in the short run? 
A)There will be a shortage of 1,500,000 units. 
B)There will be a shortage of 800,000 units. 
C)There will not be a shortage; there will be a surplus. 
D)There will be a shortage of 2,000,000 units. 
E)There will be a shortage of 500,000 units.

Quizplus · Accepted Answer

At a price ceiling of $4, the quantity demanded will be 9,000,000 units and the quantity supplied will be 8,200,000 units, resulting in a shortage of 800,000 units. This is the difference between the quantity demanded and the quantity supplied in the short run.

Refer to the Accompanying Figure,which Shows Both Short-Run and Long-Run