Question

What is the difference between a price floor and a price ceiling?

A price floor is the minimum price allowed for a good. A price ceiling is the maximum price allowed for a good.

A price floor is the maximum price allowed for a good. A price ceiling is the minimum price allowed for a good.

A price floor is an advantage for consumers for buying a good. A price ceiling is a disadvantage for consumers for buying a good.

A price floor is a disadvantage for consumers for buying a good. A price ceiling is an advantage for consumers for buying a good.

Answer 1

A price ceiling is the maximum legal price that can be charged for a product. Rent controlled apartments are an example of a good that has a price ceiling.

A price floor is the lowest legal price that can be paid for a good or service. State and federal minimum wage is an example of a price floor, so are agreements often made by labor unions.

Answer 2

A is the correct answer