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Mention an example of What are the results or outcomes of an actual governmt price-control (provide...

Mention an example of What are the results or outcomes of an actual governmt price-control (provide example) , it might be ceiling or it could be floor in United states or other country. please Include diagrams.

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Answer #1

The US Government had imposed excess burden tax on consumption of lilies which were skyrocketed back in 19th century due to higher demand and its attractiveness. Due to imposition of tax burden the prices reached an exponential high after which it lost attractiveness and hence quantity reduced from Q0 to Q1 shown below. This reduced consumer surplus due to excess burden tax and thus created deadweight loss for producers as given below in shaded area.

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