The total demand for Cement and the total supply of Cement per month in the UAE construction market are as shown in the table below:

Million Tons of Cement Demanded Price per Ton Million Ton of Cement Supplied

65 275 40

60 295 50

55 305 55

50 315 60

45 320 70

40 335 80

a)Suppose that the government establishes a price ceiling of Dh 295 per ton for ,Cement. What might prompt the government to establish this price ceiling? Explain carefully the main effects. Demonstrate your answer graphically.

b)Next, suppose that the government establishes a price floor of Dh 320 per ton for Cement. What will be the main effects of this price floor? Demonstrate your answer graphically.

c)Read the article below that published in Khaleej Times and state who sets the price ceiling in UAE? Also comment briefly on the cement prices in 2008 as compared to present cement prices? and comment if price ceiling action by the Government was / is effective.