Question

Does a price ceiling attempt to make a price higher

or lower?

Short answer

Price ceiling attempts to make a price lower.

Step-by-step solution

Step 1. Concept of price ceiling.

A price ceiling is a type of price limit in which the government fixes and upper limit is when the government establishes an uppper limit on the price for a given commodity or service. This is done to make sure that corporations do not overcharge customers and can maintain a reasonable price for their items.

Explanation of price ceiling.

A price ceiling is an attempt by the government to keep prices low. It is mostly used to control rents. This ensures that landlords can only raise rents by a specified amount each year. Price ceilings keep prices at a fixed level, but if demand rises beyond that level, there will be a scarcity.