Question

142. Refer to the above diagram. A government-set price floor is best illustrated by:

A. price A.
B. quantity E.
C. price C.
D. price B.

Answer 1

A government-set price floor is best illustrated by price C on the diagram.

Step-by-step explanation:

A government-set price floor is best illustrated by price C on the diagram. A price floor is a minimum price set by the government that prevents the market price from falling below a certain level. In this case, price C is set above the equilibrium price, which creates an excess supply or a surplus of goods.