Final answer:
A price ceiling set above the equilibrium price will not disrupt the balance between supply and demand, leading to neither a shortage nor a surplus as market transactions can occur at equilibrium levels. The correct answer is A, indicating no shortage or surplus would result.
Step-by-step explanation:
If a price ceiling is set above the equilibrium price, there will be neither a shortage nor a surplus of the good. The correct answer to this question is A. A price ceiling set above the equilibrium price will not cause the quantity demanded to rise significantly, nor will it cause the quantity supplied to fall; the market can still operate at the equilibrium level because the price ceiling is not restrictive. When a price ceiling is set below the equilibrium price, it results in a shortage because the quantity demanded exceeds the quantity supplied at the ceiling price.
However, if the price ceiling is set significantly above the equilibrium price, suppliers can still sell their goods or services at or below the equilibrium price, and buyers are willing to pay that price, which means that market transactions happen as they would without the ceiling. So, this sort of price ceiling does not create excess supply or demand.