One of the effects of a price floor (set above equilibrium price)is
A)a surplus.
B)higher-quality goods are produced.
C)more satisfied customers.
D)a shortage.

Question

Quizplus · Accepted Answer

When a price floor is set above equilibrium price, it creates an excess supply or surplus of the good. This is because suppliers are willing to supply a larger quantity of the good at the higher price, while consumers are willing to purchase less of it. As a result, there is a surplus of unsold goods that remains on the market.

One of the Effects of a Price Floor (Set Above