(Figure: The Market for Spanish Textbooks)Use Figure: The Market for Spanish Textbooks.Suppose the government believes the producers of Spanish textbooks are not profitable,and it wants to make sure textbook producers are profitable.It could impose a control called a price _____,and for it to be binding,one possible price would be _____.
A)floor;$90
B)floor;$40
C)ceiling;$40
D)ceiling;$90

Question

(Figure: The Market for Spanish Textbooks)Use Figure: The Market for Spanish Textbooks.Suppose the government believes the producers of Spanish textbooks are not profitable,and it wants to make sure textbook producers are profitable.It could impose a control called a price _____,and for it to be binding,one possible price would be _____. 
A)floor;$90 
B)floor;$40 
C)ceiling;$40 
D)ceiling;$90

Quizplus · Accepted Answer

If the government wants to ensure profitability for textbook producers, it would set a price floor above the current equilibrium price. In this case, a price floor of $90 would be binding because it is above the equilibrium price of $70 and would prevent the price from falling too low for producers to make a profit. Therefore, the correct choice is (A) floor; $90.

(Figure: the Market for Spanish Textbooks)Use Figure: the Market for Spanish