If the equilibrium price of corn is 20 cents an ear and the government imposes a floor of 30 cents an ear,the price of corn will ______________________.

Question

Quizplus · Accepted Answer

When the government imposes a price floor above the equilibrium price, the market price will increase to the level of the price floor, assuming the floor is enforced. In this case, the price of corn will increase to 30 cents an ear.

If the Equilibrium Price of Corn Is 20 Cents an Ear