Answer to Question #282642 in Macroeconomics for Shaharli

Question

Why does government impose price celling and price floor an certain commodity who are the beneficiaries of both

Answer 1

Price ceiling helps to keep a price from rising above a certain level. It controls the maximum prices that can be charged by suppliers for a given community. This is beneficial to the general public (consumers), because it helps in ensuring that given commodity is affordable.

Price floors prevent a price from falling below a certain level, and they are beneficial for producers.