One of the Problems Created by Price Floors Set Above

question 11

Multiple Choice

One of the problems created by price floors set above the equilibrium is:

• A) consumers complain about high prices.
• B) firms don't have incentives to reduce costs.
• C) the creation of surplus.
• D) how to cope with the shortages.
• E) the impact on firm profitability.

---

Definitions:

Inventory

Inventory comprises all the goods and materials held by a company for the purpose of resale or incorporation into their product.

Credit Card

A payment card issued by financial institutions that allows cardholders to borrow funds for purchases, subject to repayment with interest.

Accounts Receivable Period

The average number of days that a company takes to collect payment after a sale has been made, indicative of the business's efficiency in collecting its receivables.