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A Price Floor Is Likely to Cause Deadweight Loss Because

Question 74

Multiple Choice

A price floor is likely to cause deadweight loss because:


A) buyers incur additional search costs looking for the scarce good.
B) the quantity of the good is less than the equilibrium quantity.
C) a black market emerges and the good sells at prices above the price floor.
D) some buyers who want to buy at the controlled price are unable to find a seller willing to sell at that price.

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