Question

Have you even been convicted of or plead no contest to a felony or misdemeanor (other than a minor traffic violation)?

Complete the following table by indicating whether each of the statements is an example of a price ceiling or a price floor and whether it is binding or nonbinding.

Statement	Price Control	Binding or Not
The government prohibits gas stations from selling gasoline for more than $3.40 per gallon.	(Price Ceiling, Price Floor)	(Binding, Non-Binding)
There are many teenagers who would like to work at gas stations, but they are not hired due to minimum-wage laws.	(Price Ceiling, Price Floor)	(Binding, Non-Binding)
The government has instituted a legal minimum price of $3.40 per gallon for gasoline.	(Price Ceiling, Price Floor)	(Binding, Non-Binding)

Answer 1

Since the government is imposing a maximum limit on the price charged by seller, it is an example of price ceiling. It is not binding as the current price is averaged below or around $3

Minimum wage laws are example of price floor because these laws force employers to provide a wage that lies above the market wage. These are binding because market wage is well below the minimum wage

The minimum price of $3.40 per gallon is a price floor. This is binding because price cannot fall below this level.