Question

A price floor A. changes the equilibrium price if it is imposed in black markets. B. changes the price and quantity only if it equals the equilibrium price. C. changes the price and quantity if it is set above the equilibrium price. D. changes the price and quantity if it is set below the equilibrium price. E. does not create a black market if it is set above the equilibrium price.

Answer 1

C. changes the price and quantity if it is set above the equilibrium price.

Step-by-step explanation:

A price floor is when the government or an agency of the government sets the minimum price of a good or service.

a price floor is binding if it is set above equilibrium price.