Why does government adopt rationing technique ?

1.	Why does government adopt rationing technique ?
Answer» <html><body><p><br/></p>Solution :Price <a href="https://interviewquestions.tuteehub.com/tag/ceiling-911116" style="font-weight:bold;" target="_blank" title="Click to know more about CEILING">CEILING</a> refers to fixing price below the equilibrium price (as equilibrium price is presumed to be too high). When government intervenes and lowers the price , the quantity demanded exceeds the quantity supplied. This means everyone's demand at this price, cannot be satisfied. Though the intention of the government was to protect the consumer but it would end up creating shortage or the <a href="https://interviewquestions.tuteehub.com/tag/consumers-14615" style="font-weight:bold;" target="_blank" title="Click to know more about CONSUMERS">CONSUMERS</a>. So, there has to be rationing- an <a href="https://interviewquestions.tuteehub.com/tag/upper-721698" style="font-weight:bold;" target="_blank" title="Click to know more about UPPER">UPPER</a> limit on the amount which can be purchased within a given time period. The stipulated amount of good is sold through the fair price shops. This also explains why one cannot buy a <a href="https://interviewquestions.tuteehub.com/tag/large-1066424" style="font-weight:bold;" target="_blank" title="Click to know more about LARGE">LARGE</a> quantity at a time from a fair price or ration shop.</body></html>

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