Consider a market for fish whose market demand and market supply for fish are specified as Qd = 300 - 2.5 P and Qs = - 20 + 1.5 P respectively. The government decides to impose a price ceiling of $50 per ton. The possible black market price after the ceiling is:

a. Shortage of 120 tons of fish
b. Shortage of 175 tons of fish
c. Surplus of 120 tons of fish
d. There would be no market distortion


Answer: a. Shortage of 120 tons of fish

Economics

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