What Is the Amount of the Shortage or Surplus in the Market

question 119

Multiple Choice

What is the amount of the shortage or surplus in the market for public transportation when the price ceiling is $1.75? $\text { Market for Public transportation }$
$\begin{array}{lcl}\text { Price }&\text { Quantity Demanded }&\text { Quntity Supplied }\\\$ 0.75 & 100,000 & 65,000 \\\$ 1.00 & 92,000 & 80,000 \\\$ 1.25 & 86,000 & 86,000 \\\$ 1.50 & 80,000 & 100,000 \\\$ 1.75 & 75,000 & 115,000 \\\$ 2.00 & 68,000 & 116,000\end{array}$

• A) 100,000
• B) 86,000
• C) 75,000
• D) 40,000
• E) 0 (zero)

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Definitions:

Chargeout Rates

The rate or price that businesses charge external clients for services or goods, typically used in professional sectors to bill hours worked.

Fixed Costs

Costs that do not change with the amount of goods or services produced by a business.

Discretionary

Pertains to expenses or investments that are not essential for the operation of a business or the living standards of an individual and can be adjusted or eliminated.

Support Processes

Support processes are the administrative and facility-related activities in an organization that assist in the production of goods or delivery of services but are not directly involved in the primary operations.