Answer:
- Government legal minimum price $4.50 : Price Floor [Binding]
- Government maximum set price $4.50 : Price Ceiling [Non Binding]
Explanation:
Price Ceiling is the maximum mandated price by the government , at which a commodity can be sold in the market. It is binding if price ceiling is set below the free market equilibrium price level. It is usually set to protect interests of buyers.
Price Floor is the minimum mandated price by the government, at which a commodity can be sold in the market. It is binding if price floor is set above the free market equilibrium price level. It is usually set to protect interest of sellers.
'The government has instituted a <u>legal minimum price</u> of $4.50 per gallon for gasoline' is an example of Price Floor. As floor price 4.50 > equilibrium price 4 , it is binding.
'The government <u>prohibits</u> gas stations from selling gasoline for <u>more than</u> $4.50 per gallon' is an example of Price Ceiling. As price ceil 4.50 > equilibrium price 4 , it is non binding.
Do I have to say true or false because this is true
Answer:
(C) the fact that workers in a particular industry belong to a union.
Explanation:
All other options are considered as possible entry barriers because they may put hindrance for an entrepreneur to enter the field of producers . The fact that workers of a particular industry belong to a union because role of union comes only when industry starts functioning . It can not play any role at the start of an industry.
Answer:
B. There is a movement down along a stationary money demand curve
Explanation:
Whenever the price level changes there is movement down or up along a stationary money demand curve, in this case because the price level is decreasing there will be a movement down because the demand curve is downward sloping and when price decreases more quantity is demanded so the movement is downwards.
Option A and C are wrong because change in price levels cannot cause the curve to shift right or left. Whenever the curves shift to the right or left it is because of non price reasons.
