ECN 104 Lecture 5: Week 5 ECN104 Note
Document Summary
Price controls a price imposed on the market by a central authority so that the control price prevails and not the market price. Price floors (surplus) producers gain more and consumers gain less. It is usually done to protect the producers and ensure an adequate supply of a good. Workers with jobs at a higher wages, overall economy if higher wages = higher spe(cid:374)di(cid:374)g"s, the (cid:271)usi(cid:374)ess is (cid:373)ore (cid:373)oti(cid:448)ated. Unemployed workers, firms have higher costs, prices may rise if producers pass on cost to consumers. Export it, store it, give it away and destroy it. Price ceiling (shortage) producers gain less and consumers gain more. A price set below the market equilibrium. It is usually done to protect the consumers. The maximum legal price a seller may charge for a product or service ex. rent control black/m. Any customer who can get the good at a price lower than they would have paid for it.
