Refer to the Accompanying Figure to Answer the Following Questions

question 78

Multiple Choice

Refer to the accompanying figure to answer the following questions.

-The market is currently at market equilibrium.If a binding price ceiling of P₁ is imposed,by how much would the quantity demanded change?

• A) It would increase by 12,000 units.
• B) It would decrease by 30,500 units.
• C) It would decrease by 12,000 units.
• D) It would increase by 30,500 units.
• E) It would increase by 30,000 units.

---

Definitions:

Money Supply

The bulk sum of assets in monetary form within an economy at a particular moment.

Gross Domestic Product

The total value of all goods and services produced within a country's borders in a specific time period, used as a measure of economic performance.

Multiplier

The ratio of change in the aggregate output (or income) to the change in an initial injection of spending, demonstrating the ripple effect in the economy.

Investment Curve

A graph showing the relationship between the rate of interest and the level of investment by firms, holding other factors constant.