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

question 35

Multiple Choice

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.

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Definitions:

Year 2021

The period of time that began on January 1, 2021, and ended on December 31, 2021.

Economy

A system by which goods and services are produced, distributed, and consumed within a society or geographical area.

Phillips Curve

An economic theory that suggests an inverse relationship between the rate of inflation and the rate of unemployment within an economy.

Government Policy

The actions, laws, or regulations established by governments to guide economic, social, and administrative issues.