Good Morning,!
So I realized that there'sconfusion between price CEILING and price FLOOR. I know, I know it sounds very self-explanatory, but if you use common sense, you will NOT understand.
Price floor is the lowest legal price a commodity can be sold at. A price floor creates a surplus. Price floors are used by the government to prevent prices from being too low. The most common price floor is the minimum wage.
Price ceiling creates a shortage. A price ceiling occurs when the government puts a legal limit on how high the price of a product can be. In order for a price ceiling to be effective, it must be set below equilibrium.
*Ms. MCCARTNEY'S NOTES*
In conclusion, when in doubt think of price CEILING and price FLOOR as opposites.
Wilmeika, thinking of price ceiling and price floor as opposites is a great pneumatic device for me! I actually missed my notes on that, but now it totally makes sense. I also like to think that ceiling keeps things from rising, so if the ceiling is at the top then there's nothing to rise to, and vise versa. If the floor is the bottom then where are we trying to prevent it from falling if its already at it's lowest point. It's like a little house in the middle of the X.
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