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If a beef market is in equilibrium at $4.00 per kg, an increase in price to $6.00 per ...

If a beef market is in equilibrium at $4.00 per kg, an increase in price to $6.00 per kg may cause ____________
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  • A Surplus in the market
  • B Shortage in the in market
  • C Black market to come into operation
  • D Rationing to be introduced
Correct Answer: Option A
Explanation:
When a price floor is set above the equilibrium price, quantity supplied will exceed quantity demanded, and excess supply or surpluses will result.

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