An example of a price floor is a. rent control. b. the regulation of gasoline prices in the U. S. in the 1970s. c. any restriction on price that leads to a shortage. d. the minimum wage

Question

Dominick Ferrell

Business

20 January, 01:56

An example of a price floor is a. rent control. b. the regulation of gasoline prices in the U. S. in the 1970s. c. any restriction on price that leads to a shortage. d. the minimum wage

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Leroy Sims · Answer 1

The correct answer is letter "D": the minimum wage.

Explanation:

Price floors are limits imposed by the government on certain prices securing those prices will not fall below what the regulation establishes. Price floors benefit providers of goods and services by allowing them to earn at least a minimum amount to cover the operations of their businesses.

The minimum wage set by the government is an example of a price floor since, by law, no employee should earn less then what the minimum wage is given a certain period otherwise the employee could be fined.