Final answer:
c. Equilibrium is the term used to describe a market that is in balance. A price floor is a government-imposed minimum price that usually leads to a surplus of the product. On a demand and supply diagram, a price floor will shift the supply curve downwards.
Step-by-step explanation:
c. Equilibrium is the term used to describe a market that is in balance. When a market is at its equilibrium price and quantity, there is no pressure for it to move away from that point. However, if the market is not in equilibrium, economic pressures arise to move it towards the equilibrium price and quantity.
A price floor is a government-imposed minimum price that is set above the equilibrium price. This usually leads to a surplus of the product because the quantity supplied exceeds the quantity demanded. On a demand and supply diagram, a price floor will shift the supply curve downwards, resulting in a surplus.