suppose the government yielded to lobbying by a group of market participants and instituted a binding price…

suppose the government yielded to lobbying by a group of market participants and instituted a binding price control at $10. the graph above illustrates the market and the effect of the price control. referring to the graph above answer the following questions: 1. the group of market participants who most likely are behind the lobbying are select 2. since select can only be the sellers both buyers and sellers the buyers 3. as select quantity demanded is

suppose the government yielded to lobbying by a group of market participants and instituted a binding price control at $10. the graph above illustrates the market and the effect of the price control. referring to the graph above answer the following questions: 1. the group of market participants who most likely are behind the lobbying are select 2. since select can only be the sellers both buyers and sellers the buyers 3. as select quantity demanded is

Answer

Brief Explanations:

  1. A binding price - control at $10 is below the equilibrium price of $20. Buyers benefit from lower prices, so they are likely the ones lobbying for it.
  2. Since the price is set below the equilibrium, quantity demanded will exceed quantity supplied. At the price - control price of $10, the quantity demanded is 120 according to the demand curve.

Answer:

  1. the buyers
  2. 120