Suppose the Government Sets a Price Floor of $2

question 43

Multiple Choice

Suppose the government sets a price floor of $2.85 per bushel on corn when the current price is $2.55.This price floor will:

• A)cause a surplus of corn.
• B)cause a shortage of corn.
• C)have no immediate effect on the price of corn.
• D)increase the supply of corn.

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Definitions:

Preexisting Condition

Any medical condition or health problem that was present before an individual's health insurance policy's effective date, often affecting coverage or benefits.

Workers' Compensation

A form of insurance providing wage replacement and medical benefits to employees injured in the course of employment.

Wage Replacement

A form of benefit that compensates for income lost due to temporary disability, unemployment, or other reasons preventing a person from working.

Health Maintenance Organization (HMO)

A type of managed care operation that is typically set up as a for-profit corporation with salaried employees; group insurance that entitles members to services provided by participating hospitals, clinics, and providers.