Assume a Price Floor Is Imposed in the Market for Milk

question 109

Multiple Choice

Assume a price floor is imposed in the market for milk at the current equilibrium price, and that a price ceiling is imposed in the market for natural gas at the current equilibrium price. What will an increase in demand for both milk and natural gas create?

• A) Shortages in both the milk and natural gas markets.
• B) Surpluses in both the milk and natural gas markets.
• C) A surplus in the milk market and a shortage in the natural gas market.
• D) A shortage in the natural gas market and increase the quantity traded in the milk market.

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Definitions:

Mosses

Small, green, non-vascular plants that usually grow in dense green clumps or mats, often in damp or shady locations.

Vascular Strand

Vascular strand refers to a bundle of plant tissues that includes xylem and phloem, conducting water, nutrients, and sugars throughout the plant.

Microphylls

Small, simple leaves with a single vein, found in some plant species, notably the lycophytes.

Megaphylls

Large leaves with a complex vein structure found in most vascular plants, as opposed to the simpler microphylls.