Question

Which of the following is an example of floor price?

• A. Minimum Support Price for Foodgrain
• B. Price printed on any article
• C. Price taken by Seller
• D. Price asked by buyer to buy

Hint:

Floor = minimum legal price (protects producers); Ceiling = maximum legal price (protects consumers).

Answer 1

The Correct Option is A

Step 1: Establish a Minimum Price.
A price floor is a legally mandated lowest price that cannot be undercut in market transactions. It is set higher than the market equilibrium to safeguard producers.
Step 2: Identify Corresponding Items.
- MSP (Minimum Support Price) serves as a prime policy illustration of a price floor implemented to secure farmers' earnings.
- (B) “Price printed” refers merely to the displayed or marked price, not a governmental minimum.
- (C) “Price taken by seller” and (D) “Price asked by buyer” represent negotiation figures, not statutory minimums.
Final Determination:\[\boxed{\text{Minimum Support Price (MSP) represents a price floor.}}\]