the government has set a price floor on bread. manufacturers cannot sell loaves for less than $5.00, which…
the government has set a price floor on bread. manufacturers cannot sell loaves for less than $5.00, which is a dollar above the market price. what will most likely result from this price control? the quantity demanded for bread will decrease, and the quantity supplied will increase. the quantity demanded and quantity supplied for bread will increase. the quantity demanded for bread will increase, and the quantity supplied will decrease. the quantity demanded and quantity supplied for bread will decrease.
Answer
Brief Explanations:
When a price - floor is set above the market price, according to the law of demand and supply, higher prices lead to a decrease in the quantity demanded (as consumers are less willing to buy at a higher price) and an increase in the quantity supplied (as producers are more willing to sell at a higher price).
Answer:
The quantity demanded for bread will decrease, and the quantity supplied will increase.