Price Floor Definition Economics. For a price floor to be effective the minimum price has to be higher than the equilibrium price. Price floor has been found.
In turn it can provide a boost to the suppliers and sellers who may achieve a higher income as a result. Pressured by special interest groups our beloved government is often convinced that the price of a good needs to be kept at a higher level. Price floors are used by the government to prevent prices from being too low.
A price floor is an established lower boundary on the price of a commodity in the market.
Term price floor Definition. Perhaps the best-known example of a price floor is the minimum wage which is based on the normative view that someone working full time ought to be able to afford a basic standard of living. The most common price floor is the minimum wage--the minimum price that can be payed for labor. A price floor in economics is a minimum price imposed by a government or agency for a particular.
