Suppose you are a policymaker in Washington DC. Lobbyists for the preschoolers of America have put pressure on their representatives to cap prices on graham crackers, and you have been assigned a position on a new committee to study the impact of a price ceiling on graham crackers.
1. Discuss by using a fully labeled demand and supply graph (label all the axes and any lines you put in your graph) what such an artificial price looks like.
2. Discuss what the results of such a move are for the graham cracker market. In other words, will there be a SHORTAGE, a SURPLUS, or neither created? Why?