If A Price Ceiling Is Not Binding
The market will be less efficient than it would be without the price ceiling. A price ceiling is a government or group imposed price control or limit on how high a price is charged for a product commodity or service governments use price ceilings to protect consumers from conditions that could make commodities prohibitively expensive. Price Controls Price Floors And Ceilings Illustrated The latter example would be a binding price floor while the former would not be binding. If a price ceiling is not binding . There will be no effect on the market price or quantity sold. A binding price ceiling is when the price ceiling that is set by the government is below the prevailing equilibrium price. There will be no effect on the market price or quantity sold. A price ceiling is a maximum amount mandated by law that a seller can charge for a product or service. This is an example of a non binding or not effective price ceiling. Another way to think about this is to start at a price...