An economic analysis cannot provide a final answer to the question of whether the government should intervene in markets by imposing price ceilings and price floors, because it seeks to address positive questions such as "what is."
Price ceilings and price floors are government-imposed maximums and minimums on the price of certain goods or services. It is usually done to protect buyers and suppliers or manage scarce resources during difficult economic times.
Governments typically purchase the amount of the surplus or impose production restrictions in an attempt to reduce the surplus. Price ceilings create shortages by setting the price below the equilibrium. At the ceiling price, the quantity demanded exceeds the quantity supplied.
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