A minimal authorized worth established by a governing physique, beneath which change is prohibited, represents a selected kind of market intervention. For example, laws may dictate the bottom permissible worth for a specific agricultural product, equivalent to milk, aiming to assist farmers’ incomes.
Such interventions are sometimes applied to safeguard producers from market volatility and guarantee a fundamental degree of profitability. Traditionally, these measures have been used during times of financial hardship or overproduction to stabilize particular sectors. The intention is to stop costs from falling to ranges that might trigger vital financial misery to these working inside the focused business.
