Answer to Question #286138 in Finance for Justin

Question

at this price buyers want to purchase 40,000 burgers less than the 60,000 hamburgers producers are willing to offer graph the market surplus occurs explain the market surplus among the seller

Answer 1

The number of hamburgers demanded in market is 60,000. But actually sold in the market is 40,000. This means quantity supplied in the market is less than quantity demanded that leads to shortage of hamburgers. The price ceiling sets at P 40 that is below the equilibrium price. A price ceiling below the equilibrium price often leads to shortage of the commodity. Based on this, it can say that price ceiling forces producers to reduce the supply of hamburgers in the market. Due to this, actual sale of hamburgers is lower than quantity demanded.