What the competition charges and what consumers are willing to pay sets the price ______ while costs of producing the product establish the price ______.

A) ceiling; floor
B) floor; ceiling
C) demand curve; supply curve
D) fixed costs; variable costs

Price Ceiling

A government-imposed limit on the price charged for a product, to ensure that it remains affordable for consumers.

Price Floor

A minimum price set by the government or an organization for a particular good or service, below which it cannot be sold.

Demand Curve

A graphical representation showing the relationship between the price of a good or service and the quantity demanded for a given period, with price on the vertical axis and quantity on the horizontal axis.