Price Floor
An artificial price limitation that specifies a lowest price a product can be sold for on the market. This is done to protect the producers of this product against temporary market price drops that could force some sellers into bankruptcy, hurting long-term competition. Milk usually has a price floor – the government specifies that if the market price of milk falls below a certain price, they will step in and buy any excess production at a price minimum to prevent dairy farmers from going bankrupt.
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