-Refer to the Graph Above to Answer This Question

question 45

Multiple Choice

-Refer to the graph above to answer this question.What would be the result if an effective price floor is set which is $2 different from the equilibrium price?

• A)The price would be above equilibrium and a surplus of 60 would be produced.
• B)The price would be below equilibrium and a shortage of 60 would be produced.
• C)The price would be above equilibrium and a shortage of 60 would be produced.
• D)The price would be below equilibrium and a surplus of 60 would be produced.

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Definitions:

Public Goods

Goods that are neither excludable nor rival in consumption.

Private Goods

Goods that are both excludable and rival in consumption.

Industrial Machinery

Machines and equipment designed and used in the manufacturing and production sector.

Factor Of Production

Resources utilized in the creation of goods and services, including land, labor, capital, and entrepreneurship.