If a price floor is removed, which of the following would be a result?
A)The elimination of surpluses
B)Problems with the disposal of goods
C)Disguised discounts to sell additional goods are offered by sellers
D)Overinvestment in the industry

Question

Quizplus · Accepted Answer

The removal of a price floor would lead to a decrease in the minimum price at which goods can be sold, which would likely result in the elimination of surpluses as more buyers would be willing and able to purchase goods at the lower price. Option B is not a likely result of the removal of a price floor, as problems with disposal of goods generally arise when there is too much supply and not enough demand, which could potentially be remedied by the removal of a price floor. Option C is not a likely result of the removal of a price floor, as disguising discounts would not necessarily be needed if the price of goods is already lowered. Option D is also not a likely result of the removal of a price floor, as overinvestment in an industry is usually caused by factors such as over-optimism and a lack of regulation, rather than a change in pricing policy.

If a Price Floor Is Removed, Which of the Following