Suppose the Government Establishes a Binding Price Floor for Some

question 73

Multiple Choice

Suppose the government establishes a binding price floor for some product.At the price floor,

• A)although sellers are selling all of the product that they desire,consumers are not able to buy all that they desire.
• B)a new free-market equilibrium price and quantity will be established.
• C)both sellers and buyers are satisfied with the quantity that is being exchanged.
• D)both sellers and buyers are exchanging the free-market equilibrium quantity.
• E)although consumers are purchasing all of the product they desire at this price,the sellers are not selling all they desire.

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Definitions:

Dividends

Payments made by a corporation to its shareholder members, usually derived from profits.

Accounts Receivable

Amounts due from customers for merchandise or services rendered by a corporation, still awaiting payment.

Utilities Expense

Costs incurred by a business for basic utilities such as water, electricity, gas, and sewage services.

Services Provided

Services provided refer to the performance of non-tangible tasks or activities by a company for its clients or customers, as opposed to selling physical products.