If the Government Imposes a Price Floor That Is Above

question 54

Multiple Choice

If the government imposes a price floor that is above the equilibrium price,then the market will experience

• A) an equilibrium.
• B) a shortage.
• C) an excess supply.
• D) an increase in demand.

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Definitions:

Dishonored Note

A promissory note that has not been paid by the maker at maturity, resulting in a default.

Collection Efforts

Activities undertaken by a business or organization to pursue and receive payments owed by customers or clients.

Reversing Entries

Journal entries usually made at the beginning of an accounting period to reverse or cancel out adjusting entries from the end of the previous period.

Allowance Method

An accounting technique used to anticipate and adjust for potential future losses from uncollectible accounts receivable.