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When the government sets a price floor, it establishes a minimum price that can be charged for a good or service, often to protect producers' incomes. This is commonly seen in agricultural markets, where price floors help ensure farmers can cover their costs. However, if the price floor is set above the market equilibrium, it can lead to surpluses, as the higher price may reduce demand while encouraging increased supply. Consequently, while intended to support producers, price floors can distort market dynamics and lead to inefficiencies.
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The government my enact a price floor in order to accomplish what?
Protect producers
The government might enact a price floor in order to accomplish what?
Protect producers
Why the government might enact a price ceiling in order to accomplish what?
The government might enact a price ceiling in order to protect the poor.
The government might enact a price ceiling in order to accomplish what?
The government may impose a price ceiling in order to increase supply.
Is a price established by the government above the equilibrium market price?
Yes, a price established by the government above the equilibrium market price is known as a price floor. This typically occurs in markets for essential goods, such as minimum wage laws in labor markets. While intended to protect producers or workers, a price floor can lead to surpluses, as the quantity supplied exceeds the quantity demanded at that higher price.
The government sets a price floor in order to protect what?
A vulnerable industry
The government my enact a price floor in order to accomplish what?
Protect producers
The government might enact a price floor in order to accomplish what?
Protect producers
What is the government might enact a price floor in order to accomplish?
Protect producers
Why the government might enact a price ceiling in order to accomplish what?
The government might enact a price ceiling in order to protect the poor.
The government might enact a price ceiling in order to accomplish what?
The government may impose a price ceiling in order to increase supply.
Is a price established by the government above the equilibrium market price?
Yes, a price established by the government above the equilibrium market price is known as a price floor. This typically occurs in markets for essential goods, such as minimum wage laws in labor markets. While intended to protect producers or workers, a price floor can lead to surpluses, as the quantity supplied exceeds the quantity demanded at that higher price.
An example of price floor?
A price floor is government imposed limit on how low a price can be charged for a product or service. An example of a price floor in the US are minimum wage laws. The government has set the minimum wage that a company can pay an employee.
How is price floor different from price ceiling?
A price floor is the minimum price set by the government where as a price ceiling is the maximum price sellers can charge for a good or service.
What is a price floor?
A price floor is a government- or group-imposed price control or limit on how low a price can be charged for a product, good, commodity, or service.
What is the government controlled price ceiling on apartment price called?
Floor pricing
Price floor is a minimum price fixed by the government. True or False?
True
