The Consequence of a Price Floor Set Below the Equilibrium

question 56

Multiple Choice

The consequence of a price floor set below the equilibrium price is

• A) a surplus,where the quantity demanded exceeds the quantity supplied.
• B) a shortage,where the quantity demanded exceeds the quantity supplied.
• C) a surplus,where the quantity supplied exceeds the quantity demanded.
• D) a shortage,where the quantity supplied exceeds the quantity demanded.
• E) nothing; the price floor will have no impact on the quantity demanded or the quantity supplied.

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Definitions:

Farmers' Market

A designated market space where local farmers and vendors sell their produce and goods directly to consumers.

Global Markets

The international exchange of goods, services, and finances, characterized by global competition, pricing, and product availability.

Economy

The system of production, distribution, and consumption of goods and services within a particular geographic region.

Climate Change

The alteration in global or regional climate patterns, attributed significantly to the increased levels of atmospheric carbon dioxide produced by the use of fossil fuels.