Question

Suppose the equilibrium price of a tube of toothpaste is $2, and the government imposes a price floor of $3 per tube. as a result of the price floor, the?

a. demand curve for toothpaste shifts to the left.
b. supply curve for toothpaste shifts to the right.
c. quantity demanded of toothpaste decreases, and the quantity of toothpaste that firms want to supply increases.
d. quantity supplied of toothpaste stays the same.

Answer 1

The amount of toothpaste that consumers demand falls while the amount that businesses want to supply rises.

The activity of running a business involves creating, purchasing, and reselling commodities in order to support one's lifestyle (such as goods and services). Furthermore, it refers to "any activity or enterprise undertaken for profit." The owner of the business is responsible and liable for any debts incurred by the business since despite having a business name, they are one and the same. If the company accrues debts, the creditors may seize the owner's personal property.

Corporate tax rates cannot be applied to a firm structure. All profits earned by the business are subject to personal taxation by the owner. Although not by lawyers or government officials, the phrase is also frequently used informally to refer to a business, such as a corporation.

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