one of the problems created by price floors set above the equilibrium is: a. the creation of surplus. b. the effect on firm profitability. c. firms don't have incentives to reduce costs. d. how to cope with the shortages.



Answer :

(a) the creation of surplus. Surplus generation is one of the issues brought about by price floors set above equilibrium.

a condition of mental or emotional equilibrium: POISE attempting to regain his equilibrium a balance between conflicting forces or activities that can be static or dynamic. a condition of adjustment between opposing or divergent influences or components (as in a reversible chemical reaction when the rates of reaction in both directions are equal). The word "equilibrium" derives from the Latin word "libra," which means "weight" or "balance." As a constellation, astrological sign, and representation of the zodiac, Libra is sometimes shown as a pair of balancing scales, frequently held by the blindfolded goddess of justice, which stands for justice, fairness, and equality. Biology, chemistry, physics, and economics all have different definitions of equilibrium, yet they all relate to the harmony of opposing forces.

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