Why Does a Surplus That Occurs Under a Binding Price

question 110

Multiple Choice

Why does a surplus that occurs under a binding price floor increase over time?

• A) Demand becomes more elastic.
• B) Demand becomes more inelastic.
• C) Demand and supply both become more elastic.
• D) Demand and supply both become more inelastic.
• E) Demand becomes more elastic,but supply becomes more inelastic.

---

Definitions:

Partnership

A legal form of business operation between two or more individuals who share management and profits or losses.

Accuracy of Records

The precision and correctness of recorded financial or operational data in a company's books or databases.

Independent Auditor

An external auditor who examines the financial records and business transactions of a company to ensure accuracy and compliance with accounting standards.

Financial Analyst

A professional responsible for examining financial data and trends to help businesses and individuals make informed investment decisions.