NABTEB Economics 2022 Objective — Question 15

Question 15 of 50 from the National Business and Technical Examinations Board (NABTEB) Economics 2022 Objective paper, with the correct answer and a full explanation.

If the government imposes a minimum price on a commodity

A. market surplus occursCorrect
B. the market will be cleared in the short-run
C. excess demand occurs
D. government regulation is no longer needed

Explanation

A minimum price (price floor) is fixed above the equilibrium price to protect producers, and this causes excess supply/market surplus.

Sign up free to unlock

Score tracking
Practice history
Saved questions
Progress dashboard
Personalized sessions
Weak-topic breakdown

…and/or go further with premium services and No Ads.

Create free account

More questions from Economics 2022 Objective More Economics past papers