Chapter 5 - Price Controls And Quotas Flashcards
1
Q
Why do governments control market prices
A
lobby government to help them by altering the price
2
Q
Price controls
A
Legal restrictions on how high or low a market price may go
3
Q
Price ceiling
A
Maximum price sellers are allowed to charge for a good or service (usually below equilibrium)
4
Q
Price floor
A
A minimum price sellers are allowed to charge for a good or service (usually set above equilibrium)
5
Q
Quota
A
An upper limit, set by the government, on the quantity of some good that can be bought or sold; quantity control
