Government mandating of prices
By contrast, in the second graph, the dashed green line represents a price floor set above the free-market price.In this case, the price floor has a measurable impact on the market.Meanwhile, suppliers find they are guaranteed a new, higher price than they were charging before. Taken together, these effects mean there is now an excess supply (known as a "surplus") of the product in the market to maintain the price floor over the long term.The equilibrium price is determined when the quantity demanded is equal to the quantity supplied.Communicating this inflation goal clearly helps keep longer-term inflation expectations firmly anchored, thereby fostering price stability and moderate long-term interest rates and enhancing the FOMC's ability to promote maximum employment.
Clarity in policy communications facilitates well-informed decisionmaking by households and businesses, reduces economic and financial uncertainty, increases the effectiveness of monetary policy, and enhances transparency and accountability, which are essential in a democratic society.Consumers find they must now pay a higher price for the same product.As a result, they reduce their purchases or drop out of the market entirely.So riding to the rescue came DC Democrats – with Obamacare, and its fairy dust promises of lower prices.But if Obamacare was such a great idea – if it would make insurance so much cheaper and better – why would it include a mandate that everyone purchase it?
Unlike some of its competitors, the company continues to offer its more than 100,000 members access to the same network of 20,000 providers throughout the metropolitan area as before.