If the government sets a maximum price at which a good or service can be sold, it thereby creates
A) a price floor.
B) a black market price.
C) a price ceiling.
D) an illegal price control.

Question

Quizplus · Accepted Answer

When the government sets a maximum price at which a good or service can be sold, it creates a price ceiling. A price floor is the opposite - it sets a minimum price at which a good or service must be sold. A black market price refers to the price at which goods are sold illegally outside of official channels. An illegal price control would refer to any attempt by the government to regulate prices that is outside of their legal authority.

If the Government Sets a Maximum Price at Which a Good