Final answer:
A price ceiling is a maximum price set by the government. If the price ceiling is set below the equilibrium price, there will be excess demand or shortage. If the price ceiling is set above the equilibrium price, there will be no excess demand or shortage.
Step-by-step explanation:
A price ceiling is a legal maximum price set by the government. In this case, if a price ceiling in this market is set at p1, it means that the price cannot exceed that level. This will create a situation where the market price is below the equilibrium price, which will result in excess demand or shortage.
If the price ceiling is set at $2.40, it would be below the equilibrium price and there would be excess demand. If the price ceiling is set at $2.00, it would still be below the equilibrium price and there would still be excess demand. If the price ceiling is set at $3.60, it would be above the equilibrium price and there would be no excess demand or shortage.