A Price Floor That Is Set Above Market Equilibrium Will

question 219

Multiple Choice

A price floor that is set above market equilibrium will cause

• A) an excess quantity demanded.
• B) a shortage.
• C) a surplus.
• D) queuing on the part of consumers.

---

Definitions:

Binding Contract

A legal agreement between two or more parties that is enforceable by law.

Entores Ltd.

A landmark case in contract law that established the principle that an acceptance of an offer becomes effective when communicated.

Telex

A communication network system used to send text messages through a network of teleprinters, historically significant before the advent of modern digital communications.

Postbox Rule

A legal principle that deems an offer accepted once the acceptance is posted, not when it is received by the offeror.