Fixing price above equilibrium will cause a decrease in quantity supplied. The equilibrium price and quantity are determined by the intersection of the demand curve and supply curve. At this point, the quantity supplied is equal to the quantity demanded, and the market is said to be in equilibrium.
If the price is fixed above the equilibrium price, it creates a situation where the quantity supplied is greater than the quantity demanded. This is because at the higher price, consumers are less willing to buy the product, while producers are willing to supply more because of the higher profit margin.
As a result, there will be a surplus of the product in the market, with producers unable to sell all of their output. This surplus will cause sellers to lower their prices to sell their excess products, eventually resulting in a new equilibrium price where the quantity supplied equals the quantity demanded.
Therefore, fixing the price above equilibrium is not sustainable in the long run as it creates a surplus and reduces the profitability of the sellers. Instead, prices should be allowed to fluctuate according to market conditions to ensure that the market remains in equilibrium and that resources are allocated efficiently.