In this module, you have learned that the government may occasionally want to intervene into the price-setting mechanism of the free market. Imagine that there is a large increase in the Demand for a necessity. Debate the merits of using a price ceiling to lower the price or prevent the price from increasing.

Consider the following in your post:

• What would be the argument against allowing market forces to increase the price of the item?
• What would be the result if the price ceiling was below the equilibrium price?
• What do you think might happen to the quantity consumed of this item? Explain.
• Could you possibly think of a way for policymakers to prevent an undesirable price increase while also keeping the market in equilibrium?
• Discuss some examples where there could be an excess demand for a product and where a large price increase is undesirable.

Cite any articles or outside information used in APA format.

Please address all questions thoroughly and submit in either of the following formats:

• You can write a traditional paper and submit a .doc, .docx, or .pdf file