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

question 94

Multiple Choice

Refer to the accompanying figure, which shows both short-run and long-run demand and supply curves. If there is a $x binding price floor imposed on a pharmaceutical drug, what will be the amount of the disequilibrium in the short run?

• A) There will be a surplus of 1,500,000 units.
• B) There will be a surplus of 800,000 units.
• C) There will not be a surplus; there will be a shortage.
• D) There will be a surplus of 2,000,000 units.
• E) There will be a surplus of 500,000 units.