A government sometimes creates an excess supply of a product by setting a minimum price at which the product may be sold to consumers. This is sometimes called a:

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A price floor is a government-imposed minimum price that is set higher than the market equilibrium price. This creates an excess supply of the product because producers are willing and able to supply more of the product at the higher price, but consumers are not willing to buy as much at the higher price. As a result, a surplus of the product is created.

A Government Sometimes Creates an Excess Supply of a Product