If we observe a market where the quantity supplied exceeds the quantity demanded, but the market price does not fall, then one explanation for this observation is
A)the market has a price ceiling in place.
B)consumers don't really like this product.
C)the market has a price floor in place.
D)sellers must produce a minimum quantity of the good, regardless of the demand for the product.

Question

Quizplus · Accepted Answer

The market has a price floor in place, which means the minimum price for the product has been set above the equilibrium price. This results in the quantity supplied exceeding the quantity demanded, but the price remaining high.

If We Observe a Market Where the Quantity Supplied Exceeds