explain the buffer stock as a consequence of price floor
Due to price floor, there will be excess supply of food grains (assuming price floor is being imposed in food grains market). The excess supply will be due to the fact that price has been artificially set higher than the equilibrium price and there will be a portion of produced food grains that won't be demanded at the price so floored. This excess produce will be then procured by the government. In this manner, all the excess food grains are now being absorbed by the government and is used as stock. This is what we mean by buffer stock.
Follow the link below to refer to this topic in detail. Do watch the related video.
https://www.meritnation.com/cbse/class12-commerce/studymaterial/economics/introductory-microeconomics/market-equilibrium/338_1984_5824
Follow the link below to refer to this topic in detail. Do watch the related video.
https://www.meritnation.com/cbse/class12-commerce/studymaterial/economics/introductory-microeconomics/market-equilibrium/338_1984_5824