Which of the following typically sets the price ceiling for a product's pricing?

• A. The government
• B. International trade organizations
• C. Producers in the market
• D. Individual consumers

Answer: (A)

Verified step by step guidance

1. Understand the concept of a price ceiling: it is a legal maximum price set for a good or service, above which the price cannot rise.
2. Recognize that price ceilings are typically imposed to protect consumers from prices that are considered too high, especially for essential goods.
3. Identify the entities that have the authority to impose such legal restrictions; usually, this is a governing body or regulatory authority.
4. Evaluate the options: producers and individual consumers do not have the legal power to set maximum prices, and international trade organizations generally do not set domestic price controls.
5. Conclude that the government is the entity that typically sets price ceilings to regulate market prices and protect consumers.