Gce Model Questions Vol1 2023 Economics Question 3

Practice objective / multiple choice question 3 from the 2023 Gce Model Questions Vol1 Economics examination.

Gce Model Questions Vol1 2023 Economics Objective / Multiple Choice Easy Difficulty
Question 3 GCE_MODEL_QUESTIONS_VOL1 • 2023 • ECONOMICS • objective

The wheat market has an equilibrium price of \(\$50\) per kg and an equilibrium quantity of \(2000\) tonnes. The government imposes a price ceiling of \(\$40\) per kg. At this ceiling, quantity supplied falls to \(1500\) tonnes and quantity demanded rises to \(2500\) tonnes. What is the size of the shortage created, and what percentage of the original equilibrium quantity does this shortage represent (rounded to the nearest whole percent)?

Answer Options

A. 1500 tonnes shortage, which is 75% of the equilibrium quantity
B. 1000 tonnes shortage, which is 40% of the equilibrium quantity
C. 500 tonnes shortage, which is 25% of the equilibrium quantity
Correct Answer D. 1000 tonnes shortage, which is 50% of the equilibrium quantity
Correct Answer
D
Correct Option:
1000 tonnes shortage, which is 50% of the equilibrium quantity

About This Question

This is Gce Model Questions Vol1 2023 Economics Question 3. It is one of the objective questions from the 2023 Gce Model Questions Vol1 Economics examination.

Difficulty level: Easy .

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