When binding price ceilings are imposed in a market,what happens

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When price ceilings are imposed, the maximum legal price is set below the equilibrium price. This means that sellers cannot charge higher prices to balance the market demand and supply. As a result, the quantity demanded exceeds the quantity supplied, leading to shortages. Since price no longer serves as a rationing device, consumers who are willing to pay the equilibrium price may not be able to purchase the good or service, while the producers who are willing to supply at the equilibrium price may not be willing to supply at the lower price set by the ceiling. Hence, price ceilings create a situation of inefficiency, where demand exceeds supply, and some consumers and producers lose out, while others benefit from the lower price.

When Binding Price Ceilings Are Imposed in a Market,what Happens