Identify the negative consequences of establishing a price floor on milk.

Identify the negative consequences of establishing a price floor on milk. Negative Consequence Drag appropriate answer(s) here + Consumers will demand higher-quality milk as they are forced to pay more. There will be a surplus of milk. - + There will be a decrease in the quantity of milk demanded Sellers will be tempted to engage in illegal activity to recoup some of their costs due to milk that went unsold. Drog appropriate answer(s) here Not a Negative Consequence Identify the negative consequences of establishing a price floor on milk. Negative Consequence Drag appropriate answer(s) here + Consumers will demand higher-quality milk as they are forced to pay more. There will be a surplus of milk. – + There will be a decrease in the quantity of milk demanded Sellers will be tempted to engage in illegal activity to recoup some of their costs due to milk that went unsold. Drog appropriate answer(s) here Not a Negative Consequence

Price floor is a limit set above the equilibrium price level to
prevent sellers from charging too low prices to their
customers.
When a price floor is imposed on any good or a service within
the market, then quantity supplied exceeds quantity demanded.
This will create excess supply within the market as many units
of a good remain unsold.
To sell the remaining units the producer’s may even engage
themselves in illegal activities in order to earn profits.
Based on the above given explanation, we can classify the
negative consequences and non negative consequences of a price
floor on milk as given below,
Negative consequences :-
1. There will be a surplus of milk.
2. There will be a decrease in the quantity of milk
demanded.
3. Sellers will be tempted to engage in illegal activity to
recoup some of their costs due to milk that went unsold.
Not a negative consequence :-
1. Consumer’s will demand higher quality milk as they are forced
to pay more.

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