FIGURE 5- 2
-Refer to Figure 5- 2. A price floor set at a price of $1.00 will result in
A) a shortage of 20 units.
B) a shortage of 10 units.
C) a surplus of 20 units.
D) a surplus of 10 units
E) no change in the market outcomes.

Question

FIGURE 5- 2
-Refer to Figure 5- 2. A price floor set at a price of $1.00 will result in
A) a shortage of 20 units. 
B) a shortage of 10 units. 
C) a surplus of 20 units. 
D) a surplus of 10 units 
E) no change in the market outcomes.

Quizplus · Accepted Answer

A price floor set at $1.00 will have no effect if it is below the equilibrium price, as it does not restrict the market from reaching equilibrium.

FIGURE 5- 2 -Refer to Figure 5- 2. a Price Floor Set at Floor