Which example would be considered a price floor?
A)a rent-controlled apartment
B)a maximum legal price that could be charged for gasoline during a time of war
C)the minimum wage
D)a government decree that capped the price of bottled water in the aftermath of a devastating hurricane

Question

Quizplus · Accepted Answer

A price floor is a government-imposed minimum price that must be paid for a good or service. The minimum wage is an example of a price floor because employers are required to pay their employees at least a certain amount per hour of work. The other answer choices do not fit the definition of a price floor. A rent-controlled apartment is a maximum price that can be charged for rent. A maximum legal price for gasoline during wartime is a price ceiling. A government decree that capped the price of bottled water after a hurricane is a temporary price control, but not a price floor since it is not the minimum price that must be paid.

Which Example Would Be Considered a Price Floor