Exhibit 4-10 Supply and demand data for apricots
Bushels demandedper month
Price perbushel
Bushels suppliedper month
50
$5
80
55
4
75
60
3
70
65
2
65
70
1
55
In Exhibit 4-10, assume that the government initially sets a price floor of $4 for apricots, and then removes the $4 price floor. What effect will this price change have?
A. The price of apricots will rise.
B. The quantity of apricots demanded will fall.
C. The quantity of apricots supplied will decline.
D. Quantity supplied will continue to exceed quantity demanded.
Answer: C
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