Figure 6-14 -Refer to Figure 6-14.If the Horizontal Line on the Graph

question 81

Multiple Choice

Figure 6-14
-Refer to Figure 6-14.If the horizontal line on the graph represents a price floor,then the price floor is

• A)binding and creates a shortage of 20 units of the good.
• B)binding and creates a shortage of 40 units of the good.
• C)not binding but creates a shortage of 40 units of the good.
• D)not binding,and there will be no surplus or shortage of the good.

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Definitions:

Mixed Cost

A cost composed of a fixed and variable component, changing with the level of activity but also containing a constant element.

Escrows Completed

Typically, the term "escrow" refers to a financial arrangement where a third party holds and regulates the payment of funds required for two parties involved in a given transaction. "Escrows Completed" could refer to transactions that have successfully met their conditions and been finalized, although this is not a standard accounting or financial term.

Variable Cost

Costs that vary directly with the level of production or output.

Monthly Sales Volume

The total amount of a product or service sold by a company within the span of a month.