What is the difference between a price support and a price floor?
A) A price support is below equilibrium; a price floor is above it.
B) A price support is above equilibrium; a price floor is below it.
C) Government buys the excess supply to maintain a price floor, but not a price support.
D) Government buys the excess supply to maintain a price support, but not for a price floor.
E) There is no difference between the two.
Correct Answer:
Verified
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A)
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