Activity 01
Market Simulation: Price Ceiling Shortage
Divide class into buyers and sellers with limited goods like candy. Set a ceiling price below equilibrium and run auctions over three rounds, recording quantities traded and waitlists. Debrief with graphs showing shortage.
Explain how a price ceiling can lead to a shortage.
Facilitation TipDuring the Market Simulation, circulate with a timer and limit student trades to create visible stockouts and queues.
What to look forProvide students with a scenario: 'The government imposes a price ceiling on concert tickets at $50, but the equilibrium price is $100.' Ask them to: 1. State whether a shortage or surplus will occur. 2. Explain their reasoning in one sentence. 3. Identify one potential unintended consequence.