Answer to Question #253309 in Microeconomics for Flore

Question

with price ceiling set 40, the number of hamburgers that buyers want to buy is 60,00. But the number of hamburgers that is actually bought and sold in the hamburger is only 40,000. why does the quantity supplied determine the quantity bought and sold in the market?

Answer 1

In this case, the quantity supplied at market price is 40,000. When a price ceiling is set at 40, this is the minimum price that favours the consumer hence the quantity demanded will rise to 60,000.

It is noted that when less quantity is supplied, the demand is low because market price is high. However, when more quantity is supplied, demand is high because price is lowered, in this case by the imposition of price ceiling.