A surplus will result whenever the:
A)government imposes a price floor below the equilibrium price.
B)government imposes a price ceiling below the equilibrium price.
C)government imposes a price floor above the equilibrium price.
D)government imposes a price ceiling above the equilibrium price.

Question

A surplus will result whenever the:
A)​government imposes a price floor below the equilibrium price.
B)​government imposes a price ceiling below the equilibrium price.
C)government imposes a price floor above the equilibrium price.
D)​government imposes a price ceiling above the equilibrium price.

Quizplus · Accepted Answer

A surplus will occur when there is a price floor above the equilibrium price. This is because the price floor sets a minimum price above what the market would naturally settle at. As a result, there will be excess supply, as producers will be willing to supply more than consumers are willing to buy at the higher price. This excess supply is known as a surplus.

A Surplus Will Result Whenever The