Suppose 100 Bushels of X Are Produced at a Target

question 141

Multiple Choice

Suppose 100 bushels of X are produced at a target price of $7 per bushel,but consumers will only buy 100 bushels at $3 a bushel.What is the total deficiency payment to farmers?

• A)$400
• B)$600
• C)$300
• D)$100

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Definitions:

Interim Interest

Interest that is calculated and charged in the period between the closing of a loan and the first scheduled payment date.

Bondholders

Individuals or institutions that hold the debt securities issued by corporations or governments, entitling them to receive fixed interest payments.

Retractable

A bond (or preferred shares) with a retractable feature allows the holder to sell the bond (or preferred shares) back to the issuer before maturity at a preset price.

Holdings

Holdings refer to the securities and assets owned by an investor or investment fund.