Figure 6-1 Graph (a) Graph (b) Two graphs of supply and demand plotted on a price versus quantity coordinate system illustrate two examples of price ceilings. A graph of price, P, versus quantity, Q, shows a supply curve, S, rising linearly from the origin, and a demand curve, D, descending linearly from the upper left to the lower right. The curves intersect at a point called for convenience, (Q = Q 1, P = P 1). Above P 1 is a horizontal line indicating a price ceiling. A graph of price, P, versus quantity, Q, shows a supply curve, S, rising linearly from the origin, and a demand curve, D, descending linearly from the upper left to the lower right. The curves intersect at a point called for convenience, (Q = Q 1, P = P 1). Below P 1 is a horizontal line indicating a price ceiling. Refer to Figure 6-1. The price ceiling shown in graph (a) a. creates a shortage. b. is not binding. c. is binding. d. creates a surplus