If a Minimum Price Is Set Above Equilibrium (Assuming a Downward

question 8

Multiple Choice

If a minimum price is set above equilibrium (assuming a downward sloping demand curve and upward sloping supply curve) there will be:

• A) A price fall
• B) Excess supply
• C) Excess demand
• D) A price increase

---

Definitions:

Cash Payments Budget

A budget that estimates the cash payments an organization expects to make over a period, including expenses, purchases, and other outflows.

Selling and Administrative Expense Budget

A financial plan that estimates future selling expenses and administrative costs.

Cash Receipts

The total amount of cash collected by a business during a specific period, including revenues from sales and other transactions.

Expected Sales

The forecasted quantity of products or services a business expects to sell in a specific period.