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