In a competitive market the market demand is Qd 150 2P and

In a competitive market, the market demand is Qd = 150 - 2P and the market supply is Qs = 30 + 4P. A price ceiling of $16 will result in how much Q.

Solution

At $16 price, Qd = 150 - 2P = 150 - 2 * 16 = 150 -32 = 118

At $16 price, Qs = 30 + 4P = 30 + 4 * 16 = 30 + 64 = 94

Therefore, the demand is higher from the supply by 118 - 94 = 24 units. So, there will be a shortage of 24 units.