Microeconomics (7th Edition)
Microeconomics (7th Edition)
7th Edition
ISBN: 9780134737508
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 4, Problem 4.3.8PA

Sub part (a):

To determine

The equilibrium price and quantity of gasoline after price ceiling.

Sub part (b):

To determine

The impact of decreasing the price.

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In April 2007, there were shortages of Ghacem cement in the country which led to a risein the price of Ghacem cement. The government then intended to put a price ceiling oncement in the country to minimize the loss to users of cement for construction purposes.Some people were of the view that “the fixing of a price ceiling for cement in the countrywill not have any effect”. Briefly discuss with the aid of an appropriate diagram the effectof the imposition of price ceiling on Ghacem cement market.
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T/F In 1981, when regulations were holding the price of natural gas below its free-market level, then-Congressman Jack Kemp of New York said the following in an interview with the New York Times: “We need to decontrol natural gas, and get production of natural gas up to a higher level so we can bring down the price.” This means that there was a price ceiling for natural gas when Jack Kemp say this. True or false?

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