Price Ceiling And Price Floor Questions

A price ceiling example rent control.

Price ceiling and price floor questions.

A price ceiling is a legal maximum price that one pays for some good or service. A government imposes price ceilings in order to keep the price of some necessary good or service affordable. For example in 2005 during hurricane katrina the price of bottled water increased above 5 per gallon. Price floor and price ceiling draft.

If a price floor was set at 320 what quantity would be purchased. Real life example of a price ceiling in the 1970s the u s. This quiz worksheet combination will test your understanding of price ceilings and price floors. The opposite of a price ceiling is a price floor which sets a minimum price at which a product or service can be sold.

10 questions show answers. The next section discusses price floors. Price ceilings prevent a price from rising above a certain level. Price floors prevent a price from falling below a certain level.

Quiz questions will focus on topics such as binding price ceiling lines and the term given to how. The original intersection of demand and supply occurs at e 0 if demand shifts from d 0 to d 1 the new equilibrium would be at e 1 unless a price ceiling prevents the price from rising.