If You Were a Politician,why Would You Find It Difficult

question 160

Multiple Choice

If you were a politician,why would you find it difficult to remove a binding price floor?

• A) because it greatly benefits firms, and they would spend a lot of money to lobby against the law's repeal
• B) because it greatly benefits all consumers, who are also voters
• C) because it greatly benefits society as a whole, with all consumers able to buy as much as firms produce
• D) because it is not difficult to remove; the legal market price or quantity are not affected
• E) because it greatly benefits the government, which receives additional tax revenue as a result

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Definitions:

Lbs

An abbreviation for pounds, a unit of weight commonly used in the United States and the British imperial system; not directly a financial term unless related to commodities trading.

Coffee Futures

Financial contracts obligating the buyer to purchase coffee, and the seller to sell coffee, at a predetermined future date and price.

Pounds

A unit of mass commonly used in the British imperial and United States customary systems, equivalent to 0.453592 kilograms.

Marking to Market

The practice of updating the value of a financial instrument to reflect its current market value.