Notes for "Binding and Non Binding"
Typically a regulatory constraint that pre-empts market equilibrium by setting different price level—price ceiling or price floor.
A pricing constraint that does not pre-empt market equilibrium.
Determined by the difference between actual price paid for a good and the highest amount a consumer would have paid for the good.
The difference between actual payment for a good and the least amount a producer would have agreed to receive for the good.
The change in total surplus (sum of producer and consumer surplus) that results from the imposition of a binding constraint.