CHAPTER SIX. PRICES. When demand meets supply Demand greater than supply – shortage Supply greater than demand - surplus. Equilibrium. Price ceilings Rent control Price floors Minimum wage. Government interference with prices. Read 137-140
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What are the two ways in which the government controls prices?
Please provide an example of each.
Moving toward Equilibrium
- Price and quantity will move toward equilibrium levels
Two Factors that can lead to Disequilibrium
-Shift in supply curve
-Shift in demand curve