Which of the following statements best describes a price floor?
a) A price that suppliers can be sure to receive for their output.
b) A price floor will cause an excess supply of a good.
c) A price higher than the market equilibrium price.
d) All of the above.
Answer: d) All of the above.
You might also like to view...
________ increases the size of the money multiplier
A) An open market sale of government securities by the Fed B) An increase in the currency drain ratio C) A reduction in the desired reserve ratio D) An open market purchase of government securities by the Fed E) An increase in the size of open market operations
In the above table, saving must be
A) -$300 billion. B) $300 billion. C) $400 billion. D) -$400 billion.
The table above shows the marginal private benefit, marginal social benefit, and marginal cost of education at the College of Epsilon. What subsidy per student will the college require to take in the efficient number of students?
A) $2,400 B) $400 C) $2,800 D) $3,400
What happened to real interest rates during the early 1930s?
A) They declined as nominal interest rates declined. B) They rose as nominal interest rates rise. C) They declined due to deflation. D) They rose due to deflation.