Do all sellers benefit from a binding price floor?
A) No.A binding price floor benefits only some sellers because not all are able to sell as much as they would like in the legal market.
B) Yes.A binding price floor benefits all sellers because it allows all sellers to sell as much as they produce on the legal market.
C) No.A binding price floor doesn't benefit any sellers because sellers will be unwilling to sell any of their products.
D) No.A binding price floor benefits only some sellers because the price is initially higher but then eventually decreases to the equilibrium price.
E) No.A binding price floor doesn't benefit any buyers because buyers are unwilling to purchase any of the products at a price lower than the equilibrium.

Question

Quizplus · Accepted Answer

A binding price floor benefits only some sellers because not all sellers are able to sell as much as they would like in the legal market. Some sellers might be producing more than the market demand, and a price floor would not increase the quantity demanded. As a result, only those sellers who are producing at or below the market demand level will benefit from the price floor by being able to sell more goods at a higher price.

Do All Sellers Benefit from a Binding Price Floor