What is the difference between a price floor and a price ceiling? a. a price floor is the minimum price allowed for a good. a price ceiling is the maximum price allowed for a good. b. a price floor is the maximum price allowed for a good. a price ceiling is the minimum price allowed for a good. c. a price ceiling below the equilibrium price has no effect. d. a price floor above the equilibrium price has no effect.

The answer is A. hope this helps

The correct answer is A.

A price floor is the minimum price allowed for a good, which is established by an economic authority and which distorts the market when it is located above the equilibrium price, creating a situation of excess supply. The most famous price floor is the minimum wage in the labor market.

A price ceiling is the maximum price allowed for a good, which distorts the market when it is smaller than the equilibrum because it creates a situation of excess demand.

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