Definition Of Price Floor. Price floor is a situation when the price charged is more than or less than the equilibrium price determined by market forces of demand and supply. The government used price supports to maintain the price floor.
A price floor establishes a minimum cost for something a bottom-line benchmark. Floor base - a lower limit. A price floor must be greater than the equilibrium price in order to.
By observation it has been found that lower price floors are ineffective.
More specifically it is defined as an intervention to raise market prices if the government feels the price is too low. A price floor is an established lower boundary on the price of a commodity in the market. The government established a wage floor. The government used price supports to maintain the price floor.
