Due to new regulations, grocery stores that would like to pay better wages in order to hire more workers are prohibited from doing so. Price ceiling Binding The government prohibits grocery stores from selling milk for more than $3.90 per gallon. Price ceiling Non-binding The government has instituted a legal minimum price of $3.90 per gallon for milk.

1) Due to new regulations, grocery stores that would like to pay better wages in order to hire more workers are prohibited from doing so. - Binding

2) The government prohibits grocery stores from selling milk for more than $3.90 per gallon. - Non-binding

3) The government has instituted a legal minimum price of $3.90 per gallon for milk. - Binding

Due to new regulations, grocery stores that would like to pay better wages in order to hire more workers are prohibited from doing so. BINDING PRICE CEILING because the equilibrium price is currently higher than the price ceiling. Even though we are not given the equilibrium salary or the proposed price ceiling, since it affects the quantity demanded and supplied it must be binding.

The government prohibits grocery stores from selling milk for more than $3.90 per gallon. NON BINDING PRICE CEILING because the equilibrium price is currently lower than the price ceiling.

The government has instituted a legal minimum price of $3.90 per gallon for milk. BINDING PRICE CEILING because the equilibrium price is currently lower than the price floor.