A binding price floor in the market for wheat:
A)increases the price paid by consumers.
B)decreases the price paid by consumers.
C)decreases the price received by farmers.
D)does not change the price received by farmers.

Question

Quizplus · Accepted Answer

A binding price floor, set above the equilibrium price, increases the price paid by consumers because it legally mandates a minimum price that is higher than what the market would naturally set.

A Binding Price Floor in the Market for Wheat