what is the economic effect of price floors?\na. shortages.\nb. there are no economic effects.\nc…

what is the economic effect of price floors?\na. shortages.\nb. there are no economic effects.\nc. surpluses.\nd. an illicit market will emerge.

what is the economic effect of price floors?\na. shortages.\nb. there are no economic effects.\nc. surpluses.\nd. an illicit market will emerge.

Answer

Brief Explanations:

A price - floor is a legal minimum price. When it is set above the equilibrium price, quantity supplied exceeds quantity demanded, leading to surpluses. Shortages occur with price - ceilings (legal maximum prices). There are economic effects of price - floors. Illicit markets may emerge in response to price - ceilings in some cases, not price - floors.

Answer:

C. Surpluses