The diagram below represents the market for butter.
FIGURE 4-1

-Refer to Figure 4-1. If a price floor of $4 is imposed, how many units of butter will be sold?

Question

The diagram below represents the market for butter.
FIGURE 4-1
 
-Refer to Figure 4-1. If a price floor of $4 is imposed, how many units of butter will be sold?

Quizplus · Accepted Answer

A price floor set above the equilibrium price results in a surplus, where the quantity supplied exceeds the quantity demanded. If the price floor is $4 and the equilibrium price is below $4, only the quantity demanded at $4 will be sold, which is 3000 units.

The Diagram Below Represents the Market for Butter