Suppose in a Market with Q^d = 100 - 5P

question 60

Multiple Choice

Suppose in a market with Q^d = 100 - 5P and Q^s = 5P, 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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