Social Sciences and History / Unit 13 SSH 1217 short lesson, about 20 seconds
Price Ceilings Make Shortages
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The idea
A price ceiling is a legal maximum price. Set below the equilibrium, it keeps price from rising, so quantity demanded exceeds quantity supplied: excess demand, a shortage. Above equilibrium it binds nothing. Price controls are government laws regulating prices instead of letting markets set them.
In practice
Rent control: more renters than apartments.
Where people slip
Unintended consequences often follow, the anchor says.
Your place on the trail
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