Title

(8) Restrictions on Market Prices

Topic Category

Market Operations

Publication Date

2011

Keywords

Price Ceiling, Price Floor, Price Restrictions, Limits on Price, Surplus, Shortage

Abstract

This illustrates the effect of a price ceiling and a price floor on the market outcome. It demonstrates how price restrictions can, but need not, limit the market's ability to adjust and move to an equilibrium. Situations where surpluses or shortages emerge are illustrated, as are situations where the price restrictions have no effect on the market.

Run Time

11:19

Primary Discipline

Microeconomics

Skills Delivered

Ability to analyze price restrictions. Ability to identify situations when surpluses or shortages can be expected to emerge. Ability to explain when price restrictions will and will not have an impact on the market outcome.

Rigor Level

2000

Prerequisites

Previous Demand, Supply, & Market Videos

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