A Price Floor Is a Price

question 12

Multiple Choice

A price floor is a price

• A) below which a seller cannot legally sell.
• B) that creates a shortage of the good if it is set above the equilibrium price.
• C) above which a seller cannot legally sell.
• D) Both answers A and C are correct.
• E) Both answers B and C are correct.

Understand the use of physiological measures in research and identify specific types of physiological measures.

Explain the potential consequences of manipulations, including ceiling and floor effects.

Recognize the considerations for manipulating an independent variable, including ethicality, strength, and generalizability.

Comprehend the characteristics and outcomes of perfect competition in the short run and long run.

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Definitions:

Rate Of Return

The gain or loss of an investment over a certain period, expressed as a percentage of the investment's initial cost.

Npvgo

Net Present Value of Growth Opportunities; a measure evaluating the profitability of future investments by comparing their present value to the initial outlay.

Required Return

The minimum annual return rate that incites people or companies to allocate resources to a particular investment or project.

Constant Growth

A model in finance that assumes a stock’s dividends will continue to grow at a uniform rate indefinitely, used to estimate the stock's current value.