Whenever a price floor is imposed above equilibrium price, it is true that:
A)supply will increase due to a higher price and a surplus will result.
B)supply will increase due to a higher price until it just equals the quantity demanded.
C)demand will increase due to a higher price and a shortage will result.
D)quantity supplied will exceed the quantity demanded.

Question

Whenever a price floor is imposed above equilibrium price, it is true that:
A)​supply will increase due to a higher price and a surplus will result.
B)​supply will increase due to a higher price until it just equals the quantity demanded.
C)​demand will increase due to a higher price and a shortage will result.
D)​quantity supplied will exceed the quantity demanded.

Quizplus · Accepted Answer

Whenever a price floor is imposed above equilibrium price, the result is quantity supplied exceeding the quantity demanded, which leads to a surplus. This occurs because the higher price encourages an increase in supply, while also reducing demand.

Whenever a Price Floor Is Imposed Above Equilibrium Price, It