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Suppose That the Equilibrium Price of a Gallon of Gas

question 22

Essay

Suppose that the equilibrium price of a gallon of gas is $1.20 per gallon.The government decides to place a maximum price on gasoline and will not allow sellers to charge more than $1.40 per gallon.Draw this situation using a graph.Make sure that you show the original equilibrium and the effect of the maximum price on the market.What will happen in this market? What will happen to total surplus?


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Pertaining to or comparing between two or more cultures, often to understand differences and similarities in practices, values, or beliefs.

Reminders

Cues or signals that prompt the recall of information or motivate actions that might otherwise be forgotten.

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