FIGURE 5-2
-Refer to Figure 5-2.A price floor set at $2.50 will result in
A)a shortage of 5 units.
B)a shortage of 10 units.
C)a surplus of 10 units.
D)a surplus of 5 units.
E)no change to the market outcomes.

Question

FIGURE 5-2
-Refer to Figure 5-2.A price floor set at $2.50 will result in
A)a shortage of 5 units. 
B)a shortage of 10 units. 
C)a surplus of 10 units. 
D)a surplus of 5 units. 
E)no change to the market outcomes.

Quizplus · Accepted Answer

A price floor set above the equilibrium price will result in a surplus because the quantity supplied will exceed the quantity demanded at that price level.

FIGURE 5-2 -Refer to Figure 5-2.A Price Floor Set at $2.50 Will