Price controls
Price controls are like a parent setting a limit on how much money their child can spend. Say your parent gives you $20 to buy lunch. Without any price controls, you could buy anything you wanted with that $20, whether it's a hamburger, french fries, or a fancy salad.
But with price controls, your parent sets a limit, like $5, on how much you can spend. Now, you can only buy something that costs $5 or less – no more, no less. That way, they can make sure you don't spend too much money on lunch.
Price controls work in the same way on a bigger scale. Governments (sometimes) set a limit on how much certain goods and services can cost, like food, electricity, or rent. That way, people don't have to spend too much money on these things and can have enough money left to spend on other things.
But with price controls, your parent sets a limit, like $5, on how much you can spend. Now, you can only buy something that costs $5 or less – no more, no less. That way, they can make sure you don't spend too much money on lunch.
Price controls work in the same way on a bigger scale. Governments (sometimes) set a limit on how much certain goods and services can cost, like food, electricity, or rent. That way, people don't have to spend too much money on these things and can have enough money left to spend on other things.
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