What are price floors and price ceilings?

Price ceiling- a legal maximum price that may be changed for a particular good or service. Price floor- a legal minimum price below which a good or service may not be sold.

A price ceiling is binding when it is below the equilibrium price. It is the legal maximum price, so the market wants to reach equilibrium (which is above that) but can't legally. If it were above...

Price floor is a minimum and price ceiling is a maximum.

An example of a ceiling would be rent controlled apartments. A floor would be minimum wage.

A price floor is the minimum price set by the government where as a price ceiling is the maximum price sellers can charge for a good or service.