An introduction to U.S. macroeconomic policy issues, such as how we use monetary and fiscal policies to promote economic growth, low unemployment, and low inflation.
Monday, July 27, 2009
Price Floor
A price floor sets a minimum price that can be legally charged in a market. It is binding if the price floor is above the equilibrium price in the market. Minimum wage laws are an example of a price floor.
Sometimes its just the bigger fool theory that rules.
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