The Consequence of a Price Floor Set Below the Equilibrium

question 56

Multiple Choice

The consequence of a price floor set below the equilibrium price is

• A) a surplus,where the quantity demanded exceeds the quantity supplied.
• B) a shortage,where the quantity demanded exceeds the quantity supplied.
• C) a surplus,where the quantity supplied exceeds the quantity demanded.
• D) a shortage,where the quantity supplied exceeds the quantity demanded.
• E) nothing; the price floor will have no impact on the quantity demanded or the quantity supplied.

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Definitions:

Financial Disclosure

The release of financial information by a company to ensure transparency and inform stakeholders about its financial health.

Societal Goal

Refers to the shared objectives or outcomes that a society aims to achieve, such as economic prosperity, social welfare, and environmental sustainability.

Checkoff Provision

A labor union contract clause that requires employers to deduct union dues from employees' paychecks automatically.

Agency Shop Agreement

A labor contract clause requiring employees to either join the union or pay a fee without being forced to become union members.