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Suppose That the Government Sets a Price Floor in the Market

Question 115

Multiple Choice

Suppose that the government sets a price floor in the market for milk at $2.15 per gallon of milk.If the equilibrium price of milk is $1.99,the result of the price floor will be a _____________ of milk and ____________ exchanges will be made with the price floor than would be made in a free market.


A) shortage; fewer
B) surplus; fewer
C) shortage; more
D) surplus; more

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