Equilibrium price is the market determined price where demand is equal to supply. However, equilibrium price may not be the best price. Why does government interventation become necessary on a welfare state like India ?

Equilibrium price is the market determined price where demand is equal

1.	Equilibrium price is the market determined price where demand is equal to supply. However, equilibrium price may not be the best price. Why does government interventation become necessary on a welfare state like India ?
Answer» Solution :Even though perfectly COMPETITIVE price is equilibrium price, however it may be too high for a set of consumers or too low for a set of producers. Hence, government intereventation in form of fixation of PRICES assumes IMPORTANCE to ensure WELFARE of all.