Suppose in a Market With $Q ^ { d } = 100 - 5 P \text { and } Q ^ { s } = 5 P$

question 51

Multiple Choice

Suppose in a market with $Q ^ { d } = 100 - 5 P \text { and } Q ^ { s } = 5 P$ , the government imposes a price floor of $15. If the government is required to purchase any excess supply at the price floor, how much will the government have to pay to purchase the excess in this market?

• A)Nothing; there is no surplus
• B)$1,000
• C)$1,500
• D)$750

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Definitions:

Correcting Entry

A bookkeeping record created to rectify a mistake in the financial reports.

Classified Balance Sheet

A financial statement that organizes assets, liabilities, and equity into subcategories for clearer understanding and analysis.

Financial Statement

A formal record of the financial activities and position of a business, person, or other entity, including balance sheet, income statement, and cash flow statement.

Operating Cycle

The duration of time from when inventory is acquired to when cash is collected from receivables, reflecting a company's purchase, production, and sales process.